1

RAJYA SABHA COMMITTEES – A

PROFILE

(2005) (Standing Committees and Department-related Parliamentary Standing

Committees)

SUMMARY OF WORK DONE 2

RAJYA SABHA SECRETARIAT NEW DELHI

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July, 2006/Asadha-Sravana, 1928 (Saka)

RAJYA SABHA COMMITTEES – A

PROFILE (2005)

(Standing Committees and Department-related Parliamentary Standing Committees)

SUMMARY OF WORK DONE 3

(1st January to 31st December, 2005)

RAJYA SABHA SECRETARIAT

NEW DELHI

July, 2006/Asadha-Sravana, 1928 (Saka)

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PREFACE

This brochure attempts to present in concise form, information about the activities of five Standing Committees as well as eight Department-related Parliamentary Standing Committees being administered by the Rajya Sabha Secretariat, for the period from 1 January to 31 December, 2005.

2. For the sake of better reading, the material has been divided into thirteen chapters dealing with one Committee at a time. Each chapter gives information

regarding composition of the Committee, subjects selected for examination, review of work done, Reports presented, etc.

3. After every chapter, Annexures containing details of the sittings of Committees and Sub-Committees, etc. have been appended.

NEW DELHI; DR. YOGENDRA NARAIN, July 4, 2006

Secretary-General.

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III. CONTENTS

Chapter No. Name of the Committees Page Nos.

Chapter I Committee on Subordinate Legislation 1-14

Chapter II Committee on Petitions 15-23

Chapter III Committee on Government Assurances 24-34

Chapter IV Committee on Papers Laid on the Table 35-45

Chapter V Committee on Ethics 46-50

Chapter VI Committee on Commerce 51-67

Chapter VII Committee on Home Affairs 68-80

Chapter VIII Committee on Human Resource Development 81-143

Chapter IX Committee on Industry 144-226

Chapter X Committee on Science and Technology, Environment and Forests 227-248

Chapter XI Committee on Transport, Tourism and Culture 249-263

Chapter XII Committee on Health and Family Welfare 264-305

Chapter XIII Committee on Personnel, Public Grievances, Law and Justice 306-320

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Committee Co-ordination Section

Price: Rs. 25.00

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CHAPTER-1

COMMITTEE ON SUBORDINATE LEGISLATION I. Composition of the Committee 1 The Committee on Subordinate Legislation was constituted on the 7th August, 2004 and reconstituted on the 6th August, 2005.

1.2 The Committee consisted of following Members:-

COMMITTEE ON SUBORDINATE LEGISLATION (Nominated on the 7th August, 2004)

1. Shri A. Vijayaraghavan - Chairman 2. Shri Nabam Rebia 3. Dr. Radhakant Nayak 4. Shrimati Sukhbuns Kaur 5. Dr. T. Subbarami Reddy 6. Shri Ram Nath Kovind 7. Prof. R.B.S. Varma 8. Shri Rudra Narayan Pany 9. Shri Nand Kishore Yadav 10. Shri N. Jothi 11. Shri Ravula Chandra Sekar Reddy 12. Shri Harendra Singh Malik 13. Shri R. Shunmugasundaram 14. Shri N.K. Premachandran 15. Shri R.S. Gavai

COMMITTEE ON SUBORDINATE LEGISLATION (Nominated on the 6th August, 2005)

1. Shri A. Vijayaraghavan - Chairman 2. Shri Nabam Rebia 3. Dr. Radhakant Nayak 4. Shrimati Sukhbuns Kaur *5. Dr. T. Subbarami Reddy 6. Shri Ram Nath Kovind 7. Prof. R.B.S. Varma 12. Shri Rudra Narayan Pany 13. Shri Nand Kishore Yadav 14. Shri N. Jothi 15. Shri Ravula Chandra Sekar Reddy 12. Shri Harendra Singh Malik 13. Shri R. Shunmugasundaram 14. Shri N.K. Premachandran 15. Shri R.S. Gavai ____________________________________ *Inducted into the Council of Ministers w.e.f 29.1.2006

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II. Subjects selected for examination 1.3 The Committee selected the following subjects for detailed examination:-

Sl.No.

Ministry/Department Subject

1. Ministry of Environment & Forests The Batteries (Management and Handling) Rules, 2001.

2. Ministry of Finance The Securities and Exchange Board of India (Procedure for Holding Enquiry by Enquiry Officer and Imposing Penalty) Regulations, 2002.

3.

Ministry of Shipping, Road Transport and Highways

The Transport, Handling and Storage of Dangerous Goods in Port of Bombay Regulations 1994.

4. Ministry of Shipping, Road Transport and Highways

The Bombay Port Trust (Licensing and Control of Pilots) Regulations, 1975.

5. Ministry of Finance The Export-Import Bank of India (Employees) Pension Regulations, 2000.

6. Ministry of Commerce & Industry The Gas Cylinder Rules, 2004.

7. Ministry of Mines The Colliery Control Rules, 2004.

8. Ministry of Agriculture The Plant Quarantine (Regulation of Import into India) Order 2003.

9. Ministry of Atomic Energy The Atomic Energy (Radiation Protection) Rules, 2004.

10.

Ministry of Health and Family Welfare The Establishment of New Medical College, Opening of New or Higher Course of Study or Training and increase of Admission capacity by Medical College Regulations, 2003.

11. Ministry of Home Affairs The Andaman & Nicobar Islands Port Rules, 2004.

12. Ministry of Finance The Senior Citizen Savings Scheme Rules, 2004.

13. Ministry of Shipping, Road Transport and Highways

The Tariff Authority for Major Ports (Medical Attendance and Treatment) Regulations, 2004.

14. Ministry of Shipping, Road Transport and Highways

The Highways Administration Rules, 2004.

15. Ministry of Agriculture The Fruits and Vegetables Grading and Marking Rules, 2004.

16. Ministry of Agriculture The Pulses Grading and Marking Rules, 2003.

17. Ministry of Health and Family Welfare The Indian Medicine Central Council (Post Graduate Ayurveda Education) Regulations, 2005.

18. Ministry of Communication and Information Technology

The Telecommunication (Broadcasting Cable Services) Interconnection Regulations, 2004.

19 Ministry of Commerce and Industry The Tobacco Board (Auction) Regulations, 1984.

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20 Ministry of Railways The Railway Passengers (Manner of Investigation of untoward Accidents) Rules, 2003

21. Ministry of Finance The Subsidiary Banks General Regulations, 1959.

22. Ministry of Petroleum and Natural Gas The Naphtha (Acquisition, Sale Storage and Prevention of use in Automobile) Order, 2000.

23. Ministry of Consumer Affairs, Food and Public Distribution

The Public Distribution System (Control) Order, 2001.

24. Ministry of Finance The Customs House (Agent’s Licensing) Regulations, 2004.

25 Ministry of Commerce and Industry The Coffee Board (Cadre & Recruitment) Rules, 1993.

26 Ministry of Commerce and Industry The Coffee Board Servants’ (Probation) Rules, 1986

27 Ministry of Finance The State Bank of Mysore Officers Service Regulations) 1979-Implemantiation of 128th Report of the Committee.

28 Ministry of Consumer Affairs, Food and Public Distribution

The Consumer Protection Regulations, 2005.

29. Ministry of Communication and Information Technology

Regulation on Quality of Service of Basic and Cellular Mobile Telephone Services, 2005.

30. Ministry of Health and Family Welfare The Prohibition on Sale of Cigarettes and other Tobacco Products around Educational Institutions Rules, 2004.

31. Ministry of Power The Electricity Rules, 2005. III Review of work done (a) Sittings of the Committee 1.4 During the year, the Committee held 15 sittings for 14 hours and 15 minutes. A Statement showing the dates of sittings of the Committee held during the period under review, the duration of the sittings and the subjects discussed is given in Annexure1. (b) Study Visits 1.5 The Committee undertook study visits to various places to make on the spot study of the subjects under its examination as per the details given below:-

Sl. No.

Dates Places visited Rules / Regulations Considered

1. February 06 to 8, 2005

Mumbai (i) The Batteries (Management and Handling) Rules, 2001. (ii) The Securities and Exchange Board of India (Procedure for Holding Enquiry by Enquiry Officer and Imposing Penalty) Regulations, 2002. (iii) The Transport, Handling & Storage of Dangerous Goods in the Port of Bombay Regulations, 1994 (iv)The Bombay Port Trust (Licensing and Control of Pilots) Regulations, 1975.

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(v) The Export Import Bank of India (Employees) Pension Regulations, 2000.

2. November 7 to 10,2005

Hyderabad and Bangalore

(i) The Tobacco Board (Auction) Regulations, 1984. (ii) The Railway Passengers (Manner of Investigation of Untoward Incidents) Rules, 2003. (iii) The Subsidiary Banks General Regulations, 1959. (iv) The Naphtha (Acquisition, Sale, Storage and Prevention of use in Automobile) Order, 2000. (v) The Public Distribution System (Control) Order, 2001 (vi) The Customs House (Agent’s Licensing) Regulations, 2004 (vii) The Coffee Board (Cadre and Recruitment) Rules, 1993. (viii) The Coffee Board Servants (Probation) Rules, 1986. (ix) The Subsidiary Banks General Regulations, 1959. (x) The State Bank of Mysore Officers Service Regulations) 1979-Implementation of 128th Report of the Committee.

1.6 Verbatim record of proceedings of the meetings of Committee at which evidence was taken, was maintained. IV. Reports Presented 1.7 During 2005, the Committee presented following Reports to the House:-

Sl.No

Report No. and Date of Presentation

Subject

1. 155th (22.3.2005)

Statutory Orders Laid on the Table of the Rajya Sabha during its 202nd Session.

2.

156th (20.4.2005)

Statutory Orders Laid on the Table of the Rajya Sabha during its 203rd Session.

3. 157th (20.4.2005)

(i)The Regional Rural Bank (Appointment and Promotion of Officers and other Employees) Rules, 1998. (ii) The Punjab National Bank General Regulations, 2000. (iii) The Foreign Trade (Regulation) Rules,1993. (iv) The Export of Live Fish (Quality Control, Inspection and Monitoring) Rules, 2002. (v) The Cost Accounting Records (Electricity Industry) Rules,2001. (vi) The Life Insurance Corporation of India (Agents) Regulations, 1972-Implementation of 127th Report of the Committee.

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4. 158th (24.8.2005)

Statutory Orders Laid on the Table of the Rajya Sabha during its 204th Session.

5. 159th (24.8.2005)

(i) Non-framing of Regulation under the Trade Unions Act, 1926- Implementation of 74th Report of the Committee. (ii) The Petroleum and Natural a Rules, 1959- Implementation of the 121st Report of the Committee. (iii) The Agriculture & Processed Food Products Export Development Authority Regulation, 1999- Implementation of 143rd Report of the Committee. (iv) The Bank Officer Employees’ (Discipline and Appeal) Regulation - Implementation of 144th Report of the Committee. (v) The National Dairy Development Board (Enforcement of Claims) Regulations, 2000-- Implementation of 151st Report of the Committee.

6. 160th (16.12.2005)

(i) Model Formula for Laying of Statutory Rules before both Houses of Parliament. (ii) The Mormugao Port Employees’ (Medical Attendance) Regulations, 1969. (iii) The Mormugao Port Employees (Recruitment, Seniority & Promotion) Regulations, 1964. (iv) The Railway Passengers (Cancellation of Ticket and Refund of Fare) Rules,1998. (v) The Scheme for Bulk Filing of Returns by Salaried Employees, 2002.

7.

161st (16.12.2005)

Statutory Orders Laid on the Table of the Rajya Sabha during its 205th Session.

1.8 Minutes of the sittings of the Committee on Subordinate Legislation relating to various Reports presented to the House were prepared and presented to the House along with the relevant reports.

V Summary of Recommendations (a) 155th Report

1.9 The Committee reiterated its earlier stand as taken in its 131st and 135th Reports regarding timely laying of notification within the prescribed time schedule in case of delay in their laying respectively appending of delay statement along with the notifications apprising Parliament of the causes of delay. (b) 156th Report

1.10 The Committee reiterated its earlier stand as taken in its 131st Report, 135th and 152nd regarding timely laying of Notification and assigning distinctive number to the Notification for facilitating separate identity and to ensure that the file number of each notification be distinguished from one another, respectively.

( c ) 157th Report

1.11 The Regional Rural Banks (Appointment and Promotion of Officers and other Employees) Rules, 1998.

1.12 The Committee felt that RRBs could be given some autonomy for recruitment of staff. The Committee suggested that the surplus staff may be re-deployed in other banks.

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1.13 The Committee noted with satisfaction that the Ministry had agreed to the Committee’s suggestions and carried out the following amendments in the Regional Rural Banks (Appointment and Promotion of Officers and other Employees) Rules 1998 :-

(i) In Rule 4 by substituting the words “such number of posts” with the words “such posts” thereby rectifying the discrepancy as pointed out by the Committee as Rule 4 contained a reference to the First Schedule which contained only nomenclature of the posts and not their number.

(ii) In rule 10(1) by substituting the existing provision of sub-rule (1) as follows so as to realign the provision in the light of the provision in the Government of India brochure on reservation for SC/ST: “The posts of messenger, messenger-cum-sweeper (full time or part time), driver, driver-cum-messenger and security guard shall be filled in by the Committee of the Regional Rural Banks after making a reference to the Employment Exchange, Sainik Boards and to the agencies, if any, catering to the welfare of Physically Handicapped persons. Further, the vacancies for Scheduled Castes and Scheduled Tribes shall also be brought to the notice of Scheduled Castes and Scheduled Tribes Organisation listed in appendix 11 referred to in para 7.1 (iii) of the Brochure on Reservation for Scheduled Castes and Scheduled Tribes in services (8th Edition) as amended from time to time catering to the Welfare of Scheduled Castes and Scheduled Tribes as are recognized by the Central Government or the State Government having jurisdiction over the Regional Rural Banks filling the posts. When doing so, it should be made clear to such organizations that their function is limited to advising the Scheduled Caste/Scheduled Tribe candidates about the recruitment proposed and that it will not be for them to recommend or press the names of any individuals. The candidates should apply to the appointing authority either direct or through the Employment Exchanges as the case may be”.

(iii) In rule 10(1) proviso by incorporating the words “Other Backward Classes” so as to include OBCs also along with SCs/STs for the purpose of giving preference.

(iv) In Schedule III in provision relating to the nomination of an additional member of the Board in case of selection for SCs/STs by substituting the word “may” with the word “shall” so as to make the nomination of the members from the reserved categories mandatory.

1.14 The Committee further noted that the Ministry had issued instructions to the National Bank for Agriculture and Rural Development to issue necessary instructions to the Regional Rural Banks and sponsor banks in pursuance of the Committee’s recommendation that the qualifying service for the purpose of promotions should not be relaxed in a routine manner and that it should be decided on a case-to-case basis and the reasons for doing so must be recorded. The Committee, however, recommends that the Ministry of Finance should consider incorporating these instructions suitably in schedule III also so that the position is set right once for all. As regards Rule 5 pertaining to vacancies, the Committee is of the view that the RRB’s could be given some autonomy for recruitment of staff. As regards Schedule III governing the method of promotion, the Committee reiterated the need for balance between seniority and merit to keep the RRB’s competitive with other commercial Banks.

1.15 The Committee noted with satisfaction that the Ministry of Finance had agreed to the Committee’s suggestions and carried out the amendments in the Punjab National Bank General Regulations, 2000as under:

(i) In Regulation 2(e) by inserting regulation 2.A(i) providing for the Constitution of the Committee.

(ii) In Regulation 13(ii) by substituting the words “some other officer appointed by the Board” with the words “some other officer not below the rank of scale-II or the Company Secretary.”

(iii) In Regulation 17(iii) and (iv) by inserting an Explanation laying down the “Technical requirements” for transfer of shares and clause (v) by providing for a time limit of 60 days for registering the transfer of shares.

(iv) In Regulation 19(ii) (b) by substituting clause (b) with the following clause thereby realigning the provisions on the lines of SEBI:-

“If it has formed the opinion that such registration ought to be refused on any of the grounds mentioned in sub-regulation (i) intimate the same to the Transferor and the Transferee by notice in writing giving reasons for such refusal within 60 days from the receipt of the transfer form or within such period as may be laid down in the Listing Agreement with the concerned Stock Exchange.” (v) In Regulation 21 by inserting an explanation thereby laying down the circumstances under which a shareholder may be disqualified for registration: “Explanation- For the purposes of this regulation, a shareholder may cease to be qualified for registration-

a. If he is a guardian of minor, on the minor attaining the majority;

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b. If he is holding shares as a Karta, on his ceasing to be a Karta.

(vi) In Regulation 44 by substituting the words “any other officer of the Bank” with the words “Company Secretary or any other officer of the Bank not below the rank of Scale-II” so as to make the provisions specific.

(vii) In Regulation 46 (ii) proviso by substituting the words “by registered post, with or without acknowledgement due” with the words “by registered post, with or without acknowledgement due or by courier service or in an electronic mode” and by inserting the words “or electronic media, as the case may be” after the words “ordinary course of post” so as to add new and efficient modes of serving notices to shareholders.

(viii) In Regulation 56 (i) by substituting the words “any authorized official” with the words “any officer not below the rank of Scale-VII or Company Secretary” so as to make the provisions specific.

(ix) In Regulation 61 by inserting regulations 61A providing for the Scrutineers at Poll and 61B providing for the Manner of taking poll and result thereof on the lines of the provisions in the Companies Act, 1956.

(x) In Regulation 62 by inserting clause (iv) providing for the shareholder to inspect the minute book and to copy the minute.

1.16 The Committee further recommended that the remaining nationalized banks may also carry out similar amendments in their regulations, expeditiously.

1.17 The Committee, however, reiterates its observations on regulation 15(ii) and 16 regarding bringing in uniformity in the costs, charges and expenses in the matter of issue of duplicate certificate by various banks in similar type of transactions; regulation 30 regarding specifying the time interval between the first notice and the second notice as it feels that the system should be such that the shareholders are served with the notice duly and promptly before action for forfeiture is initiated; regulation 36 regarding absence of justification for holding the shareholder liable to pay for all calls, installments, interest, etc. as it may not be proper to charge from the shareholder for all calls, installments, interest, etc. in case his shares were being forfeited; regulation 42 (ii) regarding qualifying the words “some officer” by his rank to make the provisions specific; and regulation 58 (i) regarding increasing the quorum in the light of the total strength of shareholders so as to make it more realistic. The Committee hopes that the Ministry of Finance would consider these points and intimate to it the outcome.

1.18 The Committee noted with satisfaction that the Ministry of Commerce & Industry had agreed to amend the Foreign Trade (Regulation) Rules, 1993 (i) by deleting of the word 'substantially' in Rule 7 (1) (b) ; and (ii) by replacing the word 'temper' with the word 'forge' in Rule 7 (h). The Committee was also happy to note and appreciates that the Ministry had agreed and initiated action on the suggestions received from various organizations (i) for incorporating a chapter on the 'Export of Services' in the Foreign Trade (Development & Regulation) Act, 1992 and the Foreign Trade (Regulation) Rules, 1993 in view of their incorporation in the trade policy; (ii) for incorporating the scheme of fee in the Regulation Rules, 1993; (iii) for suitably modifying the provisions of Rules 4; 5 (1) (3); 6 and 7 (1) (d) of the Regulation Rules, 1993 so as to include services & technology in the light of developments in the trade policy; and (iv) for devising an effective mechanism for realization of penalties under the Foreign Trade (Development & Regulation) Act, 1992 and the Foreign Trade (Regulation) Rules, 1993.

1.19 The Committee hopes that the Ministry of Commerce & Industry would carry out the amendments in the Foreign Trade (Development & Regulation) Act, 1992 and the Foreign Trade (Regulation) Rules, 1993 expeditiously under intimation to it.

1.20 The Committee considered the Export of Live Fish (Quality Control, Inspection and Monitoring) Rules, 2002 in its meeting held on the 31st December, 2003. The Committee noted the Ministry's comments on most of the points. The Committee is happy to note that the Ministry had agreed to its suggestion on rule 16 (i) for prescribing a maximum time period for disposal of an appeal and had notified the same by adding sub rule (iii) in rule 16 to this effect.

1.21 The Committee reiterates its earlier stand on point no. 2 (Rule 9) and point no. 4 (Rule 14) that a time limit may be prescribed in the rules itself for grant / refusal of approval under rule 9 and for issue of certificate under rule 14; the Committee hopes that the Ministry would carry out / notify the above amendments expeditiously.

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1.22 The Committee noted the explanations furnished by the Ministry of Company Affairs on the various points that were referred to them for comments/clarifications regarding the Cost Accounting Records (Electricity Industry) Rules, 2001. The Committee was happy to note that the Ministry had agreed to substitute the words "proper records" by some other specific expressions in pursuance to the query vide point no.3. The Committee hopes the Government would carry out the amendment, expeditiously.

1.23 The Committee noted with satisfaction that in pursuance of its recommendations relating to the Life Insurance Corporation of India (Agents) Regulations, 1972 Implementation of 127th Report of the Committee the Ministry of Finance (Insurance Division) have constituted the Insurance Regulatory and Development Authority with effect from the 19th April, 2000 and had also notified the Insurance Regulatory and Development Authority (Licensing of Insurance Agents) Regulations, 2000 vide F.No. IRDA/Reg/7/2000 dated the 19th July, 2000.

1.24 As regards the Committee’s recommendations regarding payment of commission to the agents under various schemes on LIC of India as well as provisions for pension and group superannuation in the proposed model agents regulations, it noted the explanation furnished by the Ministry.

(d) 158th Report

1.25 The Committee reiterated its earlier stand as taken in its 131st 135th and 152nd Reports regarding timely laying of Notification within the prescribed time schedule.

(e) 159th Report

1.26 Non- framing of Regulations under the Trade Unions Act, 1926 -- Implementation of the 74th Report of the Committee.

1.27 The Committee took note of the fact that the Ministry of Labour and Employment had ultimately implemented its recommendations as contained in the 74th Report presented to the House on the 27th August, 1987 which, inter alia relates to (i) the incorporation of laying provisions in respect of regulations framed under section 29 of the Trade Unions Act, 1926; and (ii) the framing of Model Regulations under the Trade Unions Act, 1926. The Committee had dealt with this subject in its 57th Report also, which was presented to the House on the 22nd December, 1983.

1.28 The Committee is, however, unhappy over the fact that the Ministry of Labour and Employment have taken an unduly long period in implementing the Committee’s recommendations. One of the main reasons put forth by the Ministry for seeking extension of time for framing of the Model Regulations has been that it was considering basic change in the Industrial Disputes Act, 1947 as well as the Trade Unions Act, 1926. The Committee noted with regret that the legislation, pending enactment of which the framing of Model Regulations had been kept in abeyance, came into force after a lapse of well over a decade w.e.f. the 9th January, 2002 in the form of the Trade Unions (Amendment) Act, 2001. But, the framing of the Model Regulations took another two-and-a-half years after the enforcement of the Act w.e.f the 9th January, 2002. The Committee expects the Ministry of Labour and Employment to be more efficient in such matters in future.

1.29 The Committee hopes that the Ministry of Petroleum and Natural Gas would update and reprint the Petroleum and Natural Gas Rules, 1959 expeditiously after rectifying all the printing errors contained in the Petroleum and Natural Gas Rules, 1959-Implementation of the 121st Report of the Committee.

1.30 The Agricultural & Processed Food Products Export Development Authority Regulations, 1999 – Implementation of the 143rd Report of the Committee. 1.31 The Committee was happy to note that the Ministry of Commerce and Industry had notified the following amendments in the Agricultural & Processed Food Products Export Development Authority Regulations, 1999, as recommended by it :-

(1) Regulation 7 (point 3), by raising the minimum requirement of the quorum from 8 members to 10 members;

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(2) Regulations 10 and 26 (point 4), by substituting the words “ shall have a second or casting vote” by the words “shall have a casting vote”;

(3) Regulation 11(2) (point 5), by substituting the words “shall be effectual and binding” by the words “shall be effective and binding”;

(4) Regulation 15(2) (point 7), by substituting the words “every decision of each of the Committee of a policy nature” by the words “every decision of each of the Committee of a policy nature, viz, a decision having a permanent bearing on the functioning of the authority or a recurring financial implication for the Authority” thereby defining the words “policy nature ”as desired by the Committee;

(5) Regulation 28(9) (f) (point 11), by substituting the words “having basic monthly remuneration” by the words “having monthly remuneration”.

1.32 The Committee, however, accepted the Ministry’s comments on Regulation 16 (point 8) regarding power of the Authority to review and revise.

1.33 The Committee noted with satisfaction that the Indian Banks’ Association had since issued guidelines to the banks for making necessary amendments in the Bank Officer Employees’ (Discipline and Appeal) Regulations, 1976 for making a provision whereby appeals shall be disposed of by the Appellate Authority within a period of ninety days from the date of their receipt and further that the cases lying pending for over ninety days shall be reviewed periodically by the Appellate Authority and reasons for their non-disposal shall be recorded in writing. The Committee was pleased to note that most of the nationalized banks have notified the amended Regulations. The Committee hopes that the Ministry of Finance shall ensure that the remaining banks also notify the amendment.

1.34 The Committee was further happy to note that in pursuance of its recommendation, the Indian Banks’ Association had since issued guidelines under Regulation 12 of the Bank Officer Employees’ (Discipline and Appeal) Regulations, 1976 in the matter of reinstatement of the officer who had been placed under suspension for being in police custody beyond 48 hours but later on cleared of the charges after trial/enquiry and that the same had been circulated to all public sector banks for compliance. The Committee hoped that the Ministry of Finance shall ensure that all public sector banks took note and comply with these guidelines.

1.35 The Committee noted with satisfaction that the Ministry of Agriculture had notified necessary amendments in the National Dairy Development Board (Enforcement of Claims) Regulations, 2000 as recommended by the Committee.

(f) 160th Report

1.36 Model Formula for Laying of Statutory Rules before both Houses of Parliament. 1.37 The Committee noted that the Ministry of Law and Justice have finally enacted and notified the Delegated Legislation Provisions (Amendment) Act, 2004 whereby laying provisions had been implemented in fifty four Acts pursuant to its recommendations as contained in the 10th Report of the Committee presented to the House on the 24th May, 1971.

1.38 The Committee was happy to note that the Ministry of Shipping, Road Transport and Highways (Department of Shipping) had accepted its suggestions and notified the following amendments in the Mormugao Port Employees’ (Medical Attendance) Regulations, 1969:-

(i) Adding preamble to the regulations.

(ii) In regulation 3 (c) (vii) by substituting the words “daily rated and casual labour, other than labour employed through contractor when injured on duty” by the words “daily rated and casual labour employed by the Port when injured on duty, shall be entitled to medical attendance/treatment to the extent that facilities and medicines are available in Trust’s Hospital/Dispensary. Labour, other than employed by the Board, such as those employed by contractors are not entitled to such benefits”, thereby making the provisions clear and understandable.

(iii) In regulation 3 (d) by amending definition of the term “family” as “Family means an employee’s wife or husband, as the case may be, and parents, sisters, widowed sisters, widowed daughters, brothers,

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children, step-children, divorced/separated daughters and step-mother wholly dependent upon the employee” on the basis of the discrepancy as pointed out by the Committee.

(iv) By substituting the Note 4 below regulation 3(d) as under:- “Note: A member of the family is treated as dependent only if his/her income from all sources including pension and pension equivalent of DCRG benefit and exclusive of the relief on pension sanctioned after December, 1995 is less than Rs.1500/- p.m. The condition of dependency both in the case of husband or the wife of the employee has been dispensed with”. The Committee had pointed out that the Note 4 below regulation 3(d) was not specific.

(v) In regulation 22, by deleting the words “ not” and “in any circumstances” thereby allowing reimbursement in case of treatment of veneral diseases and delirium tremens also.

(vi) In regulation 31, by amending the “Note” below regulation 31 as under allowing reimbursement of professional fees:- “Note: The cost of medicines shall be reimbursed in full, if otherwise admissible under this regulation. The cost of medicines will include the cost of drugs injected and the professional fees for administering the injections.”

(vii) In regulation 46(i)(b), by amending the “Note” appearing below it as under so that Port employees could travel by entitled class even for medical attendance and treatment:- “Note: The facility of travel by air-conditioned accommodations at the Board’s expense is admissible as per entitlement for journeys performed for receiving medical attendance and treatment.”

(viii) In regulation 46 (ii) (b), by amending the provisions as under so as to allow payment of actual fare as per the admissibility:- “(b) For the members of his family:-Actual fare paid for the journey by bus or other public conveyances or mileage allowance at the rate of road mileage admissible to the employee, whichever is less.”

1.39 The Committee noted with satisfaction that the Ministry of Shipping, Road Transport and Highways had carried out amendments in the Mormugao Port Employees (Recruitment, Seniority & Promotion) Regulations, 1964, based upon its suggestions as under:

(i) In regulation 7 by prescribing age limit, educational, qualifications, experience, etc, in the schedule annexed to the regulations containing the details of the posts and the mode of their filling up.

(ii) In regulation 8 by amending sub-regulation(1) on the lines of similar provisions in the CCS Rules with regard to probation period.

(iii) In regulations 10(1) and (2) by substituting the words “Sub-regulation (1)” with “Sub-regulation (1) (a)”, thereby removing the discrepancy, as pointed out by the Committee.

(iv) In regulation 13 by inserting therein a provision for reservation in favour of OBCs,

(v) In regulation 14(b) by substituting the entire regulation 14 and thereby removing the discrepancies as pointed out by the Committee.

(vi) In regulation 14(h) by deleting the provisions, the same being obsolete;

(vii) In regulation 15 by providing representation to SCs/STs in the Staff Selection Committees,

(viii) In regulation 16 by providing therein representation to SCs/STs in Departmental Promotion Committee and further providing therein that the DPC may meet “as and when required” instead of “once twice a year”

1.40 The Committee hoped that the Ministry have since advised the Ports to review the regulations once in five years with a view to effect such changes as were necessary to bring them in conformity with the changed position including addition to or reduction in the strength of the lower and higher level posts.

1.41 The Railway Passengers (Cancellation of Ticket and Refund of Fare) Rules, 1998

1.42 The Committee was unhappy to note that the Ministry of Railways are still putting forth the same logic on which they had been relying earlier when this Committee had taken up for examination the rules of the year 1986. The Ministry of Railways had maintained at that time that the cancellation charges had been kept on the higher side in order to discourage touts from cornering the tickets. The Committee had never agreed to this view of the Ministry. In the Committee’s view, steep rise in the cancellation charges was not the remedy.

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The Committee in its 83rd Report presented to the Rajya Sabha on the 7th September, 1990 while examining the set of rules of 1986 on the subject had observed that “what the Ministry felt was the remedy, was worse than the disease”. The Committee was unhappy to note that the Ministry of Railways have again come forward with the same logic after a lapse of about 15 years even though the Railways have, in the meantime, computerized the whole process of reservation and cancellation of tickets. The Committee, therefore, recommended that the Ministry of Railways should take steps to find out other ways and means of checking the menace of middlemen and touts instead of resorting to levy of heavy cancellation charges. The Committee further recommended the Ministry of Railways to consider if they can prescribe a maximum ceiling for the cancellation charges for different classes of journeys/distance slabs along with the existing basis so as to mitigate the hardship caused to the ticket holders on account of cancellation of tickets.

1.43 The Committee noted with satisfaction on the Scheme for Bulk Filing of Returns by Salaried Employees, 2002 that the Ministry of Finance have streamlined the procedure for laying of statutory orders and necessary measures had been taken by them to ensure that no such delay in laying of notifications took place in future. The Committee further hoped that the Ministry shall rectify the typographical error in clause 6(1) by substituting the words "eligible employee" with the words "eligible employer" under intimation to it. 1.44. As regards the overall scheme, the Committee was not satisfied to find that the scheme had evinced a limited response and very few State or Central Government employees had taken advantage of the scheme. In this regard, the Committee noted that the department proposes to introduce electronic filing system of returns through intermediaries and also through internet under digital signatures as an alternative in view of the limited response to the scheme. It was a matter of regret that the scheme brought about by the Ministry failed to get a positive response and as a result there of it had to set out to work on its alternative in such a short period. The Committee expected the Ministry to come out with new schemes only after deeper thoughts. (g) 161st Report

1.45 The Committee reiterated its earlier stand as taken in its 131st Report , 135th and 152nd regarding timely laying of Notification.

1.46. Minutes of sittings of the Committee on Subordinate Legislation relating to various Reports presented to the House were prepared and presented to the House along with the relevant Reports.

V. Secretariat

1.47 The Committee Section -I headed by a Committee Officer constitutes the Secretariat of the Committee. A Joint Secretary, a Director and an Under Secretary remained incharge of the Branch.

1.48 To assist the Committee in its work, the statutory orders laid on the Table of the Rajya Sabha, Bills passed by the Parliament, representations / references received from individuals / Ministries an the material received from the Ministries / Departments /Various non-official organizations and individuals were studied from which points were culled out and questionnaires for written replies /evidence were prepared for the use of the Committee.

1.49 The Secretariat collected material from on-the-spot studies and prepared study tour notes.

1.50 The work relating to drafting of Reports of the Committee and their considerations and approval along with their presentation, laying, printing and distribution was undertaken. The Secretariat also dealt with the work relating to the scrutiny of action taken notes received from the Ministries concerned on the recommendations contained in the Reports of the Committee and preparation of Draft Reports of the Committee on the Action Taken Reports.

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ANNEXURE-1 (SEE PARA 1.4)

Details of the sittings o the Committee on Subordinate Legislation during the year 2005.

Sl. No.

Date Duration Hrs-Mts.

Subject

1. 07.01.2005 0-45 Consideration of following Memoranda: (i)The Central Motor Vehicles (Regulation of Bus Service Between Agartala and Dhaka) Rules, 2002.

(ii)The Small Industries Development Bank of India Pension Regulations, 2002. (iii)The Noise Pollution (Regulation and Control) Rules, 2000- Implementation of 144th Report of the Committee. (iv)The Railways (Opening for Public Carriage of Passengers) Rules, 2000- Implementation of 149th Report of the Committee. (v)The Edible Oils Packaging (Regulation) (First Amendment) Order, 1998. (vi)Counting of past service for pensionary benefits on mobility between Central Government and Central and State Autonomous Bodies and vice-versa- Implementation of 117th Report of the Committee.

2. 28-01-2003 1-30 1. Oral evidence of the Secretary, Ministry of Health and Family Welfare (Department of Health) along with the Director, All India Institute of Medical Sciences on the AllMS Regulations, 1999.

(2) Consideration of following Memorandum: (i) Representation against Implementation of Amended Schedule ‘M’ of the Drugs and Cosmetics Rules, 1945.

3. 17-03-2003 1-15 1. Consideration and adoption of the draft 155th Report of the Committee. 2. Consideration of the following Memoranda: (i)The Public Distribution System (Control) Order, 2001.

(ii)The Marble Development & Conservation Rules, 2002. (iii)The Small Industries Development Bank of India General Regulations, 2000. (iv)The Cement (Quality Control) Order, 2003.

4. 12-04-2005 1-30 Consideration and adoption of the draft 156th and 157th Reports of the Committee.

5. 10-5-2005 1-00 Oral evidence of the representatives of the Confederation of Indian

Pharmaceutical Industry (SSI), Channai on the Implementation of

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amended Schedule ‘M’ of the Drugs & Cosmetics (Eight Amendment) Rules, 2001.

6. 24-5-2005 0-30 Consideration of the following Memoranda: (i)Various regulations framed under the National Council for Teacher Education. (ii)The Telecommunication Interconnection (Charges and Revenue Sharing) Regulations, 2001. (iii)The Semiconductor Integrated Circuits Layout-Design Rules, 2001.

(iv)The IRDA (Insurance Brokers) Regulations, 2002.

7. 14-06-200 1-00 Oral evidence of the representatives of the Ministry of Finance (Department of Economic Affairs), including SBI, NABARD and RBI and the Ministry of Law and Justice (Legislative Department) on the framing of Rules/Regulations under the State Bank of India Act, 1955 and the NABARD Act, 1981.

8. 06-07-2005 2-00 Consideration of the following Memoranda:

(i)The NCTE (Guidelines for Regulation of Tuition Fees and Other Fees Chargeable by Unaided Teacher Education Institutions) Regulations, 2002.

(ii)The Prevention of Food Adulteration Rules, 1955. (iii)The Coffee Board (Cadre & Recruitment) Rules, 1993. (iv)Rules governing suspension of Government Servants.

9. 19-07-2005 0-45 1.Oral evidence of the representatives of the Ministry of Consumer

Affairs, Food and Public Distribution on the Edible Oil Packaging (Registration) Order,1998. 2. Consideration of the following Memoranda:

(i)The Animal Birth Control (Dogs) Rules, 2001. (ii)The Prevention of Cruelty to Animals (Slaughter House) Rules, 2001. (iii)The Edible Oils Packaging (Regulation) Order, 1998.

10. 23-08-2005 0-40 Consideration and Adoption of the draft 158th and 159th Reports of the Committee.

11. 05-09-2005 0-30 Consideration of the following Memoranda: (i)The Electrical Wires, Cables Appliances and Protection Devices and Accessories (Quality Control) Order, 2003. (ii)The Medical Termination of Pregnancy Rules, 2003. (iii)The Coffee Board Servants (Probation) Rules, 1986.

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(iv)The Building and Other Construction Workers (Regulations of Employment and conditions of Service) Central Rules, 1998. (v)The All India Institute of Medical Sciences Regulations, 1999.

12. 05-10-05 1-30 Oral evidence of the representatives of the Ministries of Shipping, Road Transport and Highways (Department of Road, Transport and Highways); Human Resource Development (Department of Secondary & Higher Education); Personnel, Public Grievances and Pensions (Department of Personnel and Training ) and Information and Broadcasting on the delay in laying of Rules/Regulations framed under various Acts under their administration control.

13. 24-10-2005 0-40 Consideration of the following Memoranda:

(i)The Breeding of and Experiments on Animals (Control and Supervisions) Rules, 1998. (ii)The Manufacture, Storage and Import of Hazardous Chemical Rules, 1989-Impementation of 99th Report of the Committee. (iii)The Kandla Port Employees’ (Study Leave) Regulations, 1964. (iv)The Delhi Advocates’ Welfare Fund Rules, 2001. (v) Representation against Implementation of amended Schedule ‘M’ of the Drugs and Cosmetics Rules, 1945.

14 17-11-2005 0-30 Consideration of the following Memoranda:

(i)The Security Interest (Enforcement) Rules, 2002. (ii)The Special Economic Zone Rules, 2003. (iii)The Airports Authority of India (Lost Property) Regulations, 2003; (iv)The National Housing Bank (Amendment) Act, 2000-framing of Rules/Regulations. (v)The Cigarettes and Other Tobacco (Prohibition of Advertisement and Regulation of Trade and Commerce, Production, Supply and Distribution) Rules, 2004.

15 13-12-2005 1-00 Consideration and adoption of the draft 160th and 161st Reports of the

Committee.

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CHAPTER-II

COMMITTEE ON PETITIONS I. Composition of the Committee 2.1 The Committee on Petitions which was constituted on the 7th August, 2004 remained in office till August 6, 2005 when it was reconstituted. 2.2 The composition of the Committee was as follows:-

COMMITTEE ON PETITIONS

(Constituted on the 7th August, 2004) 1. Shri Jana Krishnamurthy. K - Chairman 2. Shri Nandi Yellaiah 3. Shri V. Narayanasamy 4. Prof. Alka Balram Kshatriya 5. Shri Lalit Kishore Chaturvedi 6. Shri Dipankar Mukherjee 7. Shri P.G. Narayanan 8. Shri Bhagwati Singh 9. Shri Subash Prasad Yadav 10.Shri Dinesh Trivedi

COMMITTEE ON PETITIONS

(Re-constituted on the 6th August, 2005) 1. Shri Jana Krishnamurthy. K - Chairman 2. Shri Nandi Yellaiah 3. Shri V. Narayanasamy 4. Prof. Alka Balram Kshatriya 5. Shri Lalit Kishore Chaturvedi 6. Shri Dipankar Mukherjee 7. Shri P.G. Narayanan 8. Shri Bhagwati Singh 9. Shri Subash Prasad Yadav 10.Shri Dinesh Trivedi II. Review of Work Done (a) Sittings held and subjects discussed 2.3 During the period under review, the Committee held 10 sittings lasting for 11 hours and 35 minutes. A statement showing the dates of the sittings of the Committee held during the period under review, the duration of the sittings and the Main Agenda taken up are given in Annexure-II. (b) Study Visits 2.4 During 2005, the Committee undertook the following study visits to interact with the managements/representatives of certain organizations and the Health and Labour Secretaries of the State Governments of Karnataka, Andhra Pradesh, West Bengal, Tamil Nadu, Kerala and the Union Territory of Pondicherry on matters under its examination:-

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Sl. No.

Dates Places Visited Purpose

1. 2.

3rd to 9th February, 2005. 24th to 30th May, 2005

Bangalore. Hyderabad and Kolkata. Hyderabad, Chennai, Pondicherry and Thiruvananthapuram

Examination of the issues raised in the petitions regarding the:

(i) need for legislative measures inter alia to provide a regulatory mechanism for private nursing homes/clinics and stringent penal provisions for production/distribution etc. of spurious medicines; and

(ii) need for enactment of a comprehensive legislation for unorganized workers and effecting suitable amendments in the existing enactments to improve the conditions of construction workers/migrant labourers besides banning the use of asbestos to get rid of toxin in e-waste.

Examination of the issues raised in the petitions regarding the:-

(i) need for legislative measures inter alia to provide a regulatory mechanism for private nursing homes/clinics and stringent penal provisions for production/distribution etc. of spurious medicines;

(ii) need for enactment of a comprehensive legislation for unorganized workers and effecting suitable amendments in the existing enactments to improve the conditions of construction workers/migrant labourers besides banning the use of asbestos to get rid of toxin in e-waste; and

(iii) need for legislative and other measures to check adulteration of petrol/diesel and other malpractices at the retail outlets and action on other related matters.

III. Reports Presented 2.5 During the year 2005 the Committee presented the following Reports to the House:-

Sl. No.

Report No. and Date of Presentation

Subject

1. 122nd

(22nd March, 2005) Petitions regarding non-implementation of the amended pension payment provisions by the State Bank of India.

2.

123rd (11th August, 2005)

Petition praying for legislative and other measures to check adulteration of Petrol/Diesel and other malpractices at the retail outlets and action on some other related matters.

3. 124th Petition praying for enactment of a comprehensive legislation

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(25th November, 2005) for unorganized workers and effecting suitable amendments in the existing enactments to improve the conditions of construction workers/migrant labourers besides banning the use of asbestos to get rid of toxin in e-waste.

4. 125th (25th November, 2005)

Petition regarding violation of public policy on Employees’ Provident Fund by M/s Fairgrowth Financial Services Limited and the need for amendment in the existing laws to regulate the functioning of the Provident Fund Trusts established by the private companies in the country.

5. 126th (15th December, 2005)

Petition seeking legislative measures inter alia to provide a regulatory mechanism for private nursing homes/clinics and stringent penal provisions for production/distribution, etc. of spurious medicines.

IV. Summary of Recommendations (a) 122nd Report 2.6 The Committee noted that the basic issue raised by the petitioners was one of discrimination being practiced by the State Bank of India in the matter of grant of pension to its employees who opt for retirement after putting in 15 years of continuous service vis-à-vis similarly placed employees of the other Public Sector Banks in whose case such pension is admissible pursuant to an amendment effected by their Banks in their Pension Regulations consequent on a circular dated December 11, 2000, issued by the Indian Banks’ Association (IBA). 2.7 The Committee felt that if the VRS was designed to effect manpower planning and to prune excess staff, then the SBI should have also fallen in line with the broad thrust of the recommendation of the Committee which had been constituted to examine the issue of human resource and manpower planning in public sector banks and extended the benefit of pension to its employees ignoring in the process the fact of this being an additional benefit to the employees together with CPF, especially when the VRS was offered to the employees on their completing 15 years of service. 2.8 The Committee was strongly of the view that the usage of the words ‘pension in terms of State Bank of India Employees' Fund Rules as on relevant date’ in the Circular of the Local Head Office at Bhubaneswar left considerable room for ambiguity on that score and if the intention was really to lay down 20 years’ service criteria for pension, then that should have specifically been provided in the Circular itself instead of that being clarified through a subsequent Circular dated January 10, 2001, from their Corporate Office. In the opinion of the Committee, as a matter of fact, these two Circulars- first dated January 1, 2001, from the Local Head Office at Bhubaneswar and the second from the Corporate Office dated January 10, 2001- created enough confusion in the minds of the employees seeking retirement and gave rise to an anomalous situation which could have been avoided. In the light of this, a question, however, arises whether the petitioners have some substance in their case which can be sustained on a legal basis. The evidence that had emerged before the Committee, however did not seem to support their case. 2.9 The Committee equally felt that the Voluntary Retirement Scheme of SBI framed in 2001 was in effect a self contained optional/voluntary package for its employees and once it was clarified vide Corporate Office Circular dated January 10, 2001, viz., well before the VRS was to commence that those employees who have not completed 20 years of service will not be eligible for pension, those who exercised their option on the relevant date to apply for VRS were well aware that the pension will not be admissible to them. The contention of the petitioners, therefore, calling in question the decision of the SBI not to amend their Pension Rules pursuant to the letter dated December 11, 2000, and denying the benefit of pension to the employees opting for retirement after 15 years of service does not seem to hold good. 2.10 There also appeared to be lack of coordination between the Ministry of Finance (Banking Division) and the SBI as borne out by the fact that while the Ministry in its comments quoted the SBI to say that ‘since the amendment notified by the nationalized banks was not applicable to the Pension Scheme of SBI, the same has not been adopted by the bank’, the latter on its part denied in the course of its interaction with the Committee that it had ever been approached by the Ministry for any comments or clarifications on the issues raised by

24

the Petitioners in their petitions. The Committee trusts that the Ministry would be careful in future in such matters and ensure better coordination with the organizations/institutions under its administrative control. (b) 123rd Report 2.11 The Committee noted that a pilot project had recently been approved for strengthening the distribution network of PDS kerosene to ensure that this product is made available to the intended consumers and is not diverted for adulteration. The Committee expressed the hope that the implementation of this project will be steadfast and the bottlenecks, if any, will be identified and corrected. The Ministry has also to think of some other alternative to blue dyeing of PDS oil which does not seem to have served the purpose. 2.12 The Committee, however, in view of the inefficacy of the present monitoring system of the Ministry, recommended that an autonomous monitoring authority under the administrative control of the Chief Vigilance Commissioner with powers to supervise and regulate the import, production, distribution and consumption of naphtha and other adulterants as also to oversee adulteration and entertain complaints, be constituted, if need be, through enactment. The Committee trusts that such a monitoring agency will inspire public confidence. The Ministry will also be advised to examine the feasibility of constituting a Technical Committee of Experts including foreign experts, if any, to examine the entire gamut of adulteration right from the source to the retail outlets as also to evaluate the feasibility of any gadget which can display the purity of the fuel when it flows through the dispensing unit, and suggest remedial measures. 2.13 The Committee also made an observation that depending upon the efficacy of the electronic locking system, it will be installed in tanker-trucks expeditiously. It should also be made mandatory for the dealer and contractor owned tanker-trucks to compulsorily install such locks within a specified time-frame and for that necessary clause be incorporated in the agreement/contract. The Committee in this context also concurred with the view expressed in the Report of the V.M. Lal Committee that in order to bring about greater transparency in the transportation of fuel through tankers and to enable an ordinary citizen to make out from the tanker the type of product being unloaded at the petrol pump, there should be distinguishing colours of such tanker-trucks-those transporting petrol and diesel should be in bright Maroon colour; those engaged in transporting kerosene, Naphtha, NGL, SKO, OCS 93, C9, Benzene and solvent should be in bright Yellow colour and all others transporting any other petroleum product should be painted in bright Green colour. The Committee would like the Ministry of Petroleum and Natural Gas to adopt and implement this colour coding scheme within a time frame of six months. 2.14 The Committee noted that the system of tracking movement of truck-tankers which had been introduced by some of the public sector oil companies on experimental basis has been found to be very effective. The Committee recommended that in view of the provenness of this system, it should be implemented in right earnest and every truck-tanker should be brought within its ambit. The Committee in this context appreciated the assurance given by the Secretary of the Ministry that the oil companies would try to implement this system within one year or at the most in two years. 2.15 The Committee recommended that the field machinery of the oil PSUs needed to be strengthened, delinquent field officers punished and the periodicity of inspections at various levels increased. The Marketing Discipline Guidelines whereunder action is taken against the erring dealers also appeared to be lenient as conceded by the Secretary of the Ministry in the course of his evidence. The Committee took note of the assurance given by him that they will be revised to make them more stringent. 2.16 The Committee recommended that the new device known as denso-meter be evaluated by a team of experts from the oil industry with representatives of consumer organizations being associated with it and if it is efficacious enough, then the oil companies should introduce it at all the retail outlets in a specified time frame. The Committee also recommended that the Ministry should work out a coordinated approach for tackling adulteration and other malpractices/irregularities including cooperation with the State Governments and oil sector companies. 2.17 The Committee concurred with the view of the Ministry about the adequacy of the legal provisions but emphasized that they have to be rigorously enforced and vigilance/enforcement machinery tightened. The Committee also stressed that a review of all the existing Control Orders should be undertaken expeditiously by the Ministry and wherever necessary, the provisions should be made more stringent to eradicate the menace of adulteration.

25

2.18 The Committee noted that the termination of the dealerships on account of proven benami operation goes to amply prove that the retail outlets allotted to the reserved categories are being run/operated by persons other than actual allottees and the magnitude of the problem could be far greater. The Committee feels that the periodicity of the inspections by the oil company officials/senior officers leaves much to be desired and hence needs to be suitably raised. 2.19 The Committee was of the view that the facilities of snacks, tea, etc. to bonafide customers as already contemplated by the Ministry of Petroleum and Natural Gas should be encouraged to be provided by the Oil PSUs in the compound of the retail outlet itself near the retail outlets of Petrol which will not only dissuade the customers visiting the outlets from going to Dhabas and be a witness to the unlawful activities or misbehaviour at the hands of lumpen elements there, but also provide necessary eatables at the outlets itself. 2.20 The Committee expressed its satisfaction at fairly a good level of attention being given by the Companies to safety aspects but emphasized that there has to be no complacency on this account and the field inspecting machinery has to be strengthened and kept in top gear to prevent any untoward happening.

(c) 124th Report

2.21 The Committee felt that the proposed Social Security Scheme for the workers in the unorganized sector will not be of much help as it will take years for all the unorganized workers being brought within its ambit. The process for enactment of comprehensive legislation which has hitherto lingered on for too long needs to be expedited and the Bill should be brought for passage before Parliament without any further delay.

2.22 Even if the problem of lack of availability of resources is there, the States themselves have to blame as they are not collecting cess from the Builders/Contractors as envisaged under the Building and other Construction Workers Welfare Cess Act, 1996. The Committee was, therefore, of the view that the Ministry of Labour, Government of India, has to take more pro-active approach and stringent measures to ensure implementation of the aforesaid enactments by the respective State Governments/Union Territory Administrations exploring even the feasibility of having a Central enactment, which could be enforced by the Central Agencies.

2.23 While the Committee felt that the Tamil Nadu/Kerala models could be adopted by other States to provide benefits/facilities envisaged under the Act to the building and other construction workers, the Ministry of Labour, Government of India, could also consider effecting necessary amendments in the relevant Acts based on the good experience of the said two States.

2.24 The Committee was of the view that in view of the migration of large number of construction workers from one State to another, incorporation of a legal provision for registration of all such workers with a single authority and the Registration Certificate issued by such an authority being enforceable in all the States of the country could help relieve the situation and ensure benefits reaching them. There should also be a compulsion on the builders and contractors that the labour they engage should possess registration certificate and if the builder errs in this, he must be punished. It has also to be ensured that the statutory minimum wages are paid to the workers and the enforcement machinery in this regard has to be strengthened. There should be a grievance redressal machinery for the construction workers to look into their complaints, if any. In order to mitigate the hardships of workers engaged in construction work, wheel burrows must be provided to them to carry construction materials and the load that the male and female workers have to carry must be specified.

2.25 The Committee felt that the problems faced by the Indian labour emigrating abroad need to be addressed by the Government internally as well as in the countries of their work through Indian Embassies/High Commissions. Law has to be made more stringent to regulate agencies engaged in recruitment of workers going abroad. The Embassies/High Commissions have to coordinate more effectively with the countries concerned where Indian labourers go for work and in this regard, signing of MOUs with such countries could be of much help. An obligation under such MOUs could be cast on the contractors/employers engaging Indian workers to inform the Indian Embassies/High Commissions about such workers employed by them. Such a mechanism would not only help identify the number of Indian workers working in a particular country but would also help the Embassies to find out the unauthorized agencies/agents which have sent them.

26

2.26 The Committee expressed the hope that the Government would take further action, as required, in accordance with ILO Conventions on use of asbestos having due regard to the domestic interests. (d) 125th Report 2.27 The Committee expressed surprise as to why the Commissioner of Income Tax, Bangalore did not intervene in the matter when approached by the petitioner as it was he who had accorded recognition to the Provident Fund Trust set up by the Fairgrowth Financial Services Limited and could have withdrawn recognition if the Company was found to have violated any of the conditions necessary for such recognition. Surprisingly, the Ministry of Finance (Department of Revenue) had informed the Committee way back on September 10, 2003 that there was a case for withdrawal of recognition granted to the Fund in view of its violating one of the conditions for such recognition and the same was being looked into by the Income Tax Department, but till the presentation of the Report of this Committee no information whatsoever was given by the Ministry about the action taken by them in the matter. This speaks of sheer indifference on their part in administering the statutory provisions and failing to act in the interest of the affected employees who should have been given necessary protection. Rule 12 (2) of the Fourth Schedule to the Income Tax Act confers power on the Income Tax Authorities to inspect the accounts of the Trustees and it seems that in the case of the Provident Fund Trust set up by the Fairgrowth Financial Services Limited no such inspection was carried out even when the petitioner had approached the Commissioner of Income Tax for his intervention. Regrettably, by their inaction they have not even attempted to render justice. 2.28 The Committee was of the view that while exemption provisions for employees/employers/PF Trusts could continue in the Income Tax Act, the entire gamut of Provident Fund should come under the EPF & MP Act which can be amended to provide that all establishments irrespective of their activities and the number of employees engaged are covered thereunder. Coupled with this, there should be a provision in the Act to the effect that the recognized trusts would be required to deposit the PF money in the name of the Trusts in public provident fund or in one of the nationalized banks and the accounts would be operated by the representatives of the management and employees. The Committee expressed confidence that this measure will go a long way in preventing money from the PF account being illegally withdrawn and the employees thus being deprived of their PF dues. (e) 126th Report 2.29 There is no denying the fact that health being a State subject, it is primarily the responsibility of the respective State Governments to provide proper medical care to their people and some of them are really doing well in this area, but the Committee was of the view that at the Central level the Ministry of Health and Family Welfare has to take the lead in improving the overall health scenario by formulating a strategy with the State Governments. There is already a vast network of government hospitals/dispensaries/primary health centres in most of the States, which can be upgraded with necessary financial assistance from the Central Government so that the people at the village/taluk levels can benefit from them and the need for them to go to district hospitals is obviated. 2.30 The Committee was of the view that the Bio-medical Waste (Management and Handling) Rules, 1998 need to be enforced more vigorously and the enforcement authorities fully geared up to ensure compliance with these rules by the hospitals/clinics. If there is any lacunae in the existing Rules which is being taken advantage of by the hospitals/nursing homes the same may be plugged and necessary amendments therein made. In case, where smaller nursing homes or hospitals are not in a position to set up necessary bio-medical waste disposal facilities due to financial constraints, the Government could step in to set up Bio-medical Waste Disposal units in coordination with such smaller nursing homes/hospitals. 2.31 The Committee expressed the hope that the process for enactment of Clinical Establishments Regulation Act shall be expedited to ensure that this is enforced within a given time frame. The Committee also recommended that there should be vigorous implementation of the law for registration of doctors/para-medical staff and such of the persons as are found practicing without degrees or with fake degrees should be identified and prosecuted. 2.32 The Committee was not sure of the efficacy of the steps taken by the Government to counter the menace of spurious drugs as such drugs continue to be manufactured/distributed clandestinely and even the Ministry has admitted that majority of the States are either not adequately staffed or fully technically equipped to completely monitor the quality of drugs manufactured and sold in the States. The incorporation of stringent

27

penalties in the Drugs and Cosmetics Act may be one aspect to deal with the problem but what is needed is to first identify the manufacturing units of spurious drugs/surgical equipments which most of the times seem to be operating clandestinely and with collusion of police or other enforcement authorities. What is, therefore, needed is to make the enforcement machinery an effective instrument to come down heavily on the manufacturers/distributors of spurious drugs for which matter is to be pursued with the respective State Governments on an on-going basis and the number of Drug Inspectors have also to be suitably augmented. Special surveillance has, in any case, to be mounted at places which have become hot-beds for manufacture/sale of such drugs. 2.33 The Committee felt that arrangements should be made by the respective State Governments to see that the drug manufacturers are enabled to have captive power plants so that their factories can have uninterrupted flow of electricity. Secondly, adequate number of drug inspectors may be appointed and there will have to be stricter watch and inspection to see that the medicines are properly stored as per instructions and out-dated medicines do not get sold. 2.34 The Committee felt that there were no strict supervisory arrangements with regard to retail outlets and the present arrangement was not adequate. The Committee recommended that the feasibility of dispensing chemists selling medicines only on doctor's prescription and eschewing across the table sale without prescription should be examined by the Government. 2.35 The Committee felt that since the present level of health care facilities in the country is abysmally low, the strategy should also be to upgrade a government hospital in each district of the States to provide standard facilities and speciality treatment to the patients and in this endeavour the Central Government and the State Governments can be equal partners in sharing financial burden. However, in this endeavour the task of improving rural medical care infrastructure has to be given equal priority. A related issue is also availability of quality medicines in Government Hospitals and as of now quite often complaints continue to be received about medicines being sold in the market and cheap and spurious medicines being stored. The Committee feels that this aspect also calls for stringent monitoring mechanism or else the purpose of providing quality medicare to the people at large will be lost. 2.36 The Committee expressed the hope that the proposals for reducing the threshold limit for coverage of factories and limit for coverage of factories and establishments as well as to enhance the wage ceiling under the ESI Act will be expeditiously implemented by the ESI Corporation which will considerably address the issue of more employees and workers being brought within the ambit of the Scheme, as demanded by the petitioners. V. Secretariat

2.37 The Committee Section-II headed by a Committee Officer constitutes the Secretariat of the Committee. An Additional Secretary, a Director and an Under Secretary remained in-charge of the Branch. 2.38 To assist the Committee in its work, the material received from the Ministries/Departments/various non-governmental organizations and individuals was studied from which points were culled out and questionnaires for written replies/evidence were prepared for the use of the Committee. 2.39 The Secretariat also collected material from on-the-spot studies and judiciously utilized the inputs in the preparation of the Reports of the Committee. 2.40 The Secretariat dealt with the work relating to the scrutiny of action taken notes received from the Ministries concerned on the recommendations contained in the Reports of the Committee.

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ANNEXURE-II (See Para 2.3)

4 Details of the sittings of the Committee on Petitions during the year 2005

Sl. No. Date Duration

Hrs-Mts. Subject/Agenda

1. 18.3.2005 0-30 To consider and adopt the draft 122nd Report on the petition regarding non-implementation of the amended pension payment provisions by the State Bank of India.

2. 12.4.2005 0-30 To further consider the petition praying for legislative and other measures to check adulteration of petrol/diesel and other malpractices at the retail outlets and action on other related matters.

3. 10.5.2005 0-30 To have general discussion on the pending matters and to chalk out its future programme.

4. 17.6.2005 2-00 To hear the Secretary, Ministry of Petroleum and Natural Gas on the issues raised in the petition praying for legislative and other measures to check adulteration of petrol/diesel and other malpractices at the retail outlets and action on other related matters in the context of the evidence emerging before it on the basis of its interaction with the management of Bharat Petroleum Corporation Limited and certain individuals and written material adduced before it.

5. 4.8.2005 1-00 To consider and adopt the draft 123rd Report on the petition praying for legislative and other measures to check adulteration of petrol/diesel and other malpractices at the retail outlets and action on other related matters.

6. 29.9.2005 2-30 1. To consider/further consider the ATRs on the 101st and 116th Reports of the Committee received from the Ministries concerned; 2. To hear the Secretaries of the: (i) Ministry of Overseas Indian Affairs on some aspects of the issues raised in the petition praying for enactment of a comprehensive legislation for unorganized workers and effecting suitable amendments in the existing enactments to improve the conditions of construction workers/migrant labourers besides banning the use of asbestos to get rid of toxin in e-waste; (ii) Ministry of Health and Family Welfare on the Action Taken Report received from the Ministry on the 117th Report of the Committee on the petition praying for extension of Central Services (Medical Attendance) Rules, 1944 and all other relevant orders relating to medical attendance to the Central Government pensioners residing in areas not covered by the Central Government Health Scheme (CGHS); and (iii) Ministry of Environment and Forests on the Action Taken Report received from the Ministry on the 121st Report of the Committee on the petition praying for measures to check pollution of the Brahmani river and other water bodies in Orissa.

29

7. 19.10.2005 0-45 To consider and adopt its following draft Reports: - (i) 124th Report on the petition praying for enactment of a comprehensive legislation for unorganized workers and effecting suitable amendments in the existing enactments to improve the conditions of construction workers/migrant labourers besides banning the use of asbestos to get rid of toxin in e-waste.; and (ii) 125th Report on the petition regarding violation of public policy on Employees' Provident Fund by M/s Fairgrowth Financial Services Limited and the need for amendment in the existing laws to regulate the functioning of the Provident Fund Trusts established by the private companies in the country.

8. 14.11.2005 1-50 To hear: (i) Ms. K. Hemalata, General Secretary and Ms. A.R. Sindhu, Treasurer, All India Federation of Anganwadi Workers and Helpers, New Delhi on their petition inter-alia praying for institutionalizing the Integrated Child Development Services (ICDS)Scheme by converting it into a regular Department under the Ministry of Human Resource Development and regularization of services of Anganwadi Workers and Helpers as employees of that Department; and (ii) Shri Gopal Krishna, a resident of Delhi on his petition praying for extension of CGHS facilities to the retired/retiring employees of Employees' Provident Fund Organization.

9. 29.11.2005 0-40 To consider and adopt the draft 126th Report on the petition seeking legislative measures inter alia to provide a regulatory mechanism for private nursing homes/clinics and stringent penal provisions for production/distribution etc. of spurious medicines.

10. 20.12.2005 1-20 To hear the Secretary, Ministry of Human Resource Development (Department of Women and Child Development) on the petition inter alia praying for institutionalizing the Integrated Child Development Services (ICDS) Scheme by converting it into a regular Department under the Ministry of Human Resource Development and regularization of services of Anganwadi Workers and Helpers as employees of that Department.

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CHAPTER - III

COMMITTEE ON GOVERNMENT ASSRUANCES

I. Composition of the Committee

3. For the year 2005, the Committee on Government Assurances was constituted on 6-8-2005. 3.2 The Committee consists of the following Members:-

COMMITTEE ON GOVERNMENT ASSURANCES

(Nominated on 6th August, 2005)

1. Dr. Alladi P. Rajkumar - Chairman 2. Shrimati Prema Cariappa 3. Shri Moolchand Meena 4. Shri Jairam Ramesh 5. Shri Kalraj Mishra 6. Shri Balbir K. Punj 7. Shri Nilotpal Basu 8. Shri Janeshwar Mishra 9. Shri B.J. Panda 10. Dr. Chandan Mitra II. Subjects Selected for Examination 3.3 The Committee on Government Assurances examined the assurances pertaining to the following subjects:-

Sl. No.

Ministry/Deptt. Assurance No. with date

Subject

1. Personnel, Public Grievances and Pensions

USQ. No.2562/ 18.3.1999

Law to confiscate property of corrupt public servants

2 Heavy Industries & Public Enterprises

USQ. No.185/12.7.2000 Revival of sick PSEs

3 Health and Family Welfare

USQ.No.3/15.7.2002 Demonstration by CGHS employees

4 Defence USQ.No.779/ 27.11.2002

CAG criticism on purchases made during Kargil war

5 Health & Family Welfare i) USQ. No. 1863/ 9.12.2002 ii) USQ.No.2561/ 16.12.2002

i) Registration of diagnostic laboratories ii) Monitoring of diagnostic laboratories

6 Communications & Information Technology

USQ.No.927/27.2.2003 ATMs in post offices in Karnataka

7 External Affairs

USQ.No.995/27.2.2003 Policy regarding NRIs

8 Home Affairs USQ.No.1473/5.3.2003 FIRs registered in connection with rioting and killing after Godhra incident

9 Urban Development & USQ.No.2614/7.4.2003 Municipal Reforms Project in Karnataka

31

Poverty Alleviation

10 Finance USQ.No.2690/ 8.4.2003

Tighter accountability norms for banks

11 Shipping, Road Transport and Highways (Deptt. of Road Transport & Highways)

USQ.No.3688/ 24.4.2003

Flyover on T-junction of Delhi Faridabad - Jaitpur village

12 Rural Development USQ.No.4925/ 7.5.2003

Report of Task Force for Wasteland/ Watershed Development

*13 Urban Development USQ. No. 132/ 21.7.2003

Potable water to urban population in Uttaranchal

*14 Tourism USQ. No. 96/2.12.2003

Tourism potential of Karnataka Coastline

15 Health & Family Welfare USQ.No.554/8.12.2003

AIIMS Status to Calcutta Medical College

16 Culture SQ.No.90/3.12.1999

Jallianwala Bagh Trust

17 Railways USQ.No.750/27.7.2001

Corruption cases in Railway Board

18 Finance USQ. No. 3910/ 28.8.2001

Salient features of the Govinda Rao Committee

19 Civil Aviation i) USQ. No.4229/ 7.5.2002 ii)USQ.No.602/ 23.7.2002 iii)USQ.No.1347/ 30.7.2002 iv) USQ. No. 1360/ 3.12.2002 v)USQ.No.651/ 25.2.2003 vi) USQ. No. 1406/ 6.12.2003 vii) USQ. No. 2168/ 23.12.03

i) Request for purchase of aircrafts ii) Aircraft purchase by the Indian Airlines iii) Upgradation of aircrafts in I.A. iv) IA’s fleet expansion plans v) Acquisition of aircrafts by IA vi) Fleet requirements of AI and IA vii) Aircrafts with AI and IA

20 Defence USQ. No. 1507/ 31.7.2002

Flight of young scientists from DRDO

21 Urban Employment & Poverty Alleviation

i) SQ.No.415/ 12.8.2002 ii) USQ. No. 2373/ 11.8.2003 iii) USQ. No. 2142/ 22.12.2003

i) Civic Amenities in Metropolitan Cities. ii) The National Slum Policy iii) The National Slum Policy.

* The Committee did not accede to the request for dropping.

32

22 Ocean Development USQ.No.1144/ 29.11.2002

Survey on the continental shelf.

23 Finance USQ.No.696/25.2.2003 Corruption cases against employees of Income Tax and Customs Department

24 External Affairs USQ.No.269/20.2.2003 Sharing of Indus Water

25 Road Transport and Highways

SQ.No.489/24.4.2003 NHAI proposal to Karnataka

26 External Affairs USQ.No.3634/ 24.4.2003

Cultural Centres

27 Agriculture USQ.No. 3734/ 25.4.2003

Situation Assessment Survey on Farmers

28 Home Affairs USQ.No.4636/5.5.2003 Recovery of property tax from Embassies and Foreign Agencies

29 Communications and Information Technology

USQ.No. 1927/7.8.2003 Waiting list of telephone connections in J&K

30 Finance USQ.No.1444/ 16.12.2003

Agencies investigating fraud committed by MD,TFL.

31 Human Resource Development

SQ.No.280/19.12.2003 Law to protect traditional knowledge and thought.

32 Petroleum & Natural Gas i) USQ. No. 194/ 21.11.2000 ii) USQ. No. 971/ 29.7.2003

i) Freeze on FIPB approved LNG products ii) New LNG policy.

33 Petroleum & Natural Gas USQ. No. 931/ 28.11.2000

Sales tax scam in Gujarat

34 Personnel, Public Grievances & Pensions

USQ. No.3748/ 19.4.2001

Number of cases arising out of revelations made in Tehelka tapes

35 Railways USQ. No. 2619/ 9.8.2002

Misappropriation in Jodhpur Railway Hospital

36 Heavy Industries & Public Enterprises

USQ. No.537/ 25.11.2002

Revival of Praga Tools Ltd.

37 Defence Supplementary raised by Shri B.P. Singhal,M.P. on SQ. No. 227/ 4.12.2002

Cooperation of State Governments in NCC activities

38 Road Transport and Highways

USQ. No. 3099/ 19.12.2002

Completion of bypass.

33

*39 Communications and

Information Technology USQ. No. 191/ 20.2.2003

Convergence Bill, 2002

40 Petroleum & Natural Gas SQ. No. 198/ 4.3.2003

Petroleum Regulatory Board

41 Communications and Information Technology

USQ. No.3579/ 24.4.2003

FAX/STD/ISD facilities in village panchayats.

42 Agriculture USQ. No.1365/1.8.2003

Identification of drought genes.

43 Urban Development and Poverty Alleviation

i) USQ. No. 1635/ 4.8.2003 ii) USQ. No. 2382/11.8.03

i) Soft loans for Bangalore Metro Project ii) Metro Rail Project, Bangalore

44 Petroleum & Natural Gas Supplementary raised by Shri Munavvar Hasan, M.P. on SQ. No. 226/5.8.2003

New LPG agencies in Uttar Pradesh.

45 Textiles USQ. No. 924/ 10.12.2003

Setting up garment, apparel and weaving parks in M.P.

46 External Affairs USQ. No. 2427/ 8.8.2002

Service tax on embassies

47 External Affairs USQ.No.3327/ 24.8.2000

Lapses in the issue of passport

48 Communications & Information Technology

USQ.No.2238/ 12.12.2002

Loss due to non-termination of license of Koshika Telecom Ltd

49 Health & Family Welfare USQ. No. 2843/ 15.12.2000

Raids for fake drugs in Delhi

50 Finance USQ.No.696/25.2.2003 Corruption cases against employees of Income Tax and Customs Department

51 Water Resources USQ. No.765/ 25.2.2003.

Loss due to flood in North Bihar

52 Human Resource Development

USQ.No.371/ 19.7.2002

Grading system in CBSE

53 Personnel, Public Grievances & Pensions

Supplementary raised by Shri Rama Shanker Kaushik,M.P. on SQ. No.643/7.5.2003 .

Criminal cases against IAS/ IPS officers

54 Railways USQ. No.656/ 25.7.2003

Law to deal with ticketless passengers

55 Health & Family Welfare USQ.No. 554/8.12.2003 AIIMS Status to Calcutta Medical College

* The Committee did not accede to the request for dropping.

34

56 Shipping, Road Transport and Highways

USQ.NO.1848/ 18.12.2003

Corruption in highway construction project

57 Tourism USQ. No.294/13.7.2004. Tourism in Andman and Nicobar Archipelago and Lakshadweep Islands

58 Law & Justice USQ. NO.409/6.12.2004 Circuit bench of Kolkata High Court at Jalpaiguri

59 Communications and Information Technology

USQ. No.1198/ 14.3.2002

Development of Posts’ new agenda

60 Health & Family Welfare USQ. NO.1979/5.8.2003

Posting of doctors in villages

61 Commerce & Industry USQ. No.2540/ 6.12.2002

ASSOCHAM for removal of tax discrimination

62 Railways USQ. NO.426/21.2.2003 Rail neer

63 Information & Broadcasting

USQ. NO.4591/5.5.2003 Programmes on Doordarshan

64 External Affairs USQ. No.453/15.7.2004 Special economic zones to attract foreign investment

65 Power USQ.No.848/21.7.2004 Hydel power project with joint venture with Nepal

66 Textiles Supplementary raised by Smt. Vanga Geetha, M.P. on SQ. No. 302/ 22.12.2004

Protection of the Domestic Silk Industry.

67 Defence USQ.No.221/1.12.99 Arms haul in Operation Leech

68 Defence i) USQ,No.275/ 22.11.2000 ii) USQ.No.512/ 26.7.2001 iii)USQ.No.2165/ 12.3.2003

Acquisition of sophisticated artillery guns Acquisition of sophisticated artillery guns and News-item captioned ‘Arms deal in the making’.

69 Defence USQ.No.1802/ 20.3.2002

Acquiring tracked self-propelled gun

70 Youth Affairs and Sports i) SQ.No.481/ 22.12.2000 ii) USQ.No.990 / 2.3.2001

Ban by BCCI on playing Cricket Withdrawal of Arjuna Award for match fixing

71 Youth Affairs and Sports USQ.No.3165/ 23.3.2001

Legislation for Match Fixing as Criminal Offence

72 Agriculture SQ.No.299/2.8.2002 Veeresh Committee on suicide by farmers

73 Communications and Information Technology

USQ.No.191/20.2.2003 Convergence Bill, 2002

35

74 Human Resource Development

SQ.No.254/7.3.2003 Foreign Direct Investment in education sector

75 Road Transport & Highways

USQ.No.2444/13.3.2003 Four laning of Delhi-Moradabad –Lucknow Highway

76 Urban Development USQ.No.132/21.7.2003 Potable Water to Urban Population in Uttaranchal

77 Environment & Forests USQ.No.254/22.7.2003 Construction of Taj Heritage Project

78 Communications & Information Technology

USQ.No.956/ 11.12.2003

Postal scam in Bihar

79 Rural Development Supplementary by Prof. Saifu-Din Soz, M.P. on SQ. No.42/7.7.2004

Steps to bring holistic development in Rural Areas

80 Home Affairs USQ.No.24/1.12.2004 Introduction of FBI-like force to tackle terrorism.

81 Culture Supplementary by Shri Santosh Bagrodia, M.P. on SQ.No.162/13.12.2004

Languages spoken in the country

82 Finance USQ.No.1986/ 21.12.2004

Retired workers of divested PSUs

83 Personnel, Public Grievances and Pensions

SQ.No.332/18.3.99 Number of scams detected during 1997-98 and till date in the country.

84 Home Affairs USQ.No.1840/20.3.2002 Water dispute between Punjab and Haryana.

85 Personnel, Public Grievances and Pensions

USQ.No.2916 /18.12.2002

Raids under anti-corruption drive.

86 Finance USQ.No.696/25.2.2003

Corruption cases against employees of Income Tax and Customs Department

87 Home Affairs USQ.No.835/26.2.2003 Arrest in connection with Gujarat riots

88 Defence USQ.No.1405/5.3.2003 Land for expansion and developmental programmes

89 Communications and Information Technology

USQ.No.1927/7.8.2003 Waiting list of telephone connections in J.& K.

90 Civil Aviation i) USQ.No.1406/ 16.12.2003 ii)USQ.No.2168/ 23.12.2003

Fleet requirements of Air India and Indian Airlines and Aircrafts with IA and AI.

91 Commerce & Industry USQ.No.2028/ 22.12.2003

Higher official under CBI investigation

92 Railways USQ.No.605/16.7.2004 Mysterious fires in bogies

36

93 Petroleum & Natural Gas USQ.No.2203/ 24.8.2004

Promotion of LPG.

94 Law & Justice USQ.No.409/ 6.12.2004

Circuit bench of Kolkata High Court at Jalpaiguri

95 Agriculture USQ.No.1603/ 17.12.2004

Reports of National Commission on Farmers

96 Agriculture i) SQ.No.243/18.3.2005 ii) SQ NO.254/ 18.3.2005

National Commission on Farmers Interim Report of National Commission on Farmers.

97 Finance USQ.No.2818/ 19.4.2005

FDI in Insurance Sector.

98 Information and Broadcasting

USQ.No.4580/5.5.2003 Programmes telecast on DD

III. Review of Work Done (a) Sittings of the Committee 3.4 During the year 2005, the Committee held 12 sittings lasting 13 hours and 20 minutes. Statement showing the dates of sittings of the Committee held during the period under review, the duration of the sittings, and the subject discussed are given in Annexure III. (b) Study Visits.

3.5 During 2005, The Committee undertook study visit to various places as per the details given below to hold discussions with the managements of certain institutions/organisations etc on the matter under its examinations:-

Sl. No.

Dated Places visited Purpose

1.

Local Visit at Delhi 3.1.2005

Indian Oil Corporation Ltd.

Assurances pertaining to (i) SQ.No.103 dated 9.12.2003 regarding offloading of cross-holding by Oil PSUs and (ii) SQ.No.401 dated 24.8.2004 regarding hike in security deposit for new LPG connection.

2. Mumbai From 19th to 22nd January, 2005

i) Bank of India ii) Jawaharlal Nehru Port

Trust iii) Bank of Maharashtra iv) Hindustan Petroleum

Corporation Ltd. v) Union Bank of India vi) Mumbai Port Trust vii) Bharat Petroleum

Corporation Ltd. (BPCL)

viii) Central Bank of India

Assurances pertaining to (i) USQ.No.201 dated 22.7.2003 regarding loan for the development of agriculture, (ii) USQ.No.2229 dated 23.12.2003 regarding guidelines for relief to natural calamities affected areas, (iii) USQ.No.4597 dated 5.5.2003 regarding revision of guidelines for private sector investment in major ports, (iv) SQ.No.103 dated 9.12.2003 regarding offloading of cross-holding by oil PSUs (v) SQ.No.401 dated 24.8.2004 regarding hike in security deposit for new LPG connection and

37

ix) ONGC x) Bank of Baroda xi) Dena Bank

(vi) SQ.No.207 dated 20.7.2004 regarding LNG terminal at Mangalore .

3. Local Visit at Delhi 2.6.2005

i) National Thermal Power Corporation (NTPC)

ii) GAIL India Ltd..

Assurance pertaining to SQ.No.422 dated 25.8.2004 regarding 1000 MW Power Plant in Maharashtra. Assurances pertaining to (i) SQ.No.103 dated 9.12.2003 regarding offloading of cross-holding by Oil PSUs and (ii) USQ. No.1422 dated 17.8.2004 regarding new plants of GAIL.

4. Bangalore-Goa-Mumbai From 6th to 12th November, 2005

i) Bharat Electronics Ltd. ii) Bharat Earth Movers Ltd. iii) State Bank of Mysore iv) Corporation Bank v) Syndicate Bank vi) Canara Bank vii) Goa Shipyard Ltd. viii) Mormugao Port Trust ix) Chief Secretary, Govt.

of Goa x) Indian Rare Earths Ltd. xi) Shipping Corporation of

India Ltd. xii) Export Credit Guarantee

Corporation of India Ltd.xiii) Chief Secretary, Govt.

of Maharashtra xiv) EXIM Bank xv) IDBI xvi) KVIC

Assurances pertaining to (i) USQ. No. 325 dated 14.7.2004 regarding compassionate appointments. (ii) USQ. No.2828 dated 19.4.2005 regarding loans to unemployed graduates (iii) USQ. No.4992 dated 10.5.2005 regarding disbursement of loans to farmers by major banks (iv) USQ. No.4597 dated 5.5.2003 regarding revision of guidelines for private sector investment in major ports (v) USQ. No.170 dated 2.12.2004 regarding new pension scheme for port workers (vi) USQ. No. 1481 dated 3.12.2002 regarding tourism under concurrent list (vii) USQ. No. 2132 dated 11.3.2003 regarding development of sea beaches (viii) USQ. No 1438 dated 16.12.2004 regarding threat to national security due to mining of mineral sands (ix) USQ.No.417 dated 3.3.2005 regarding development of cruise shipping (x) USQ. No. 1050 dated 10.3.2005 regarding employment of foreign marine officers (xi) SQ. No.303 dated 23.3.2005 regarding setting up of Export Credit Guarantee Corporation (xii) USQ. No.1405 dated 5.3.2003 regarding land for expansion and developmental programmes (xiii) USQ. No. 2132 dated 11.3.2003 regarding development of sea beaches (xiv) USQ. No.2874 dated 19.4.2005 regarding investment by Banks for development of Industries (xv) USQ. No.1987 dated 21.12.2004 regarding infrastructure bonds (xvi) SQ. No.124 dated 10.3.2005 regarding turnover of KVIC.

3.6 Verbatim record of proceedings of the sittings of the Committee at which evidence was taken has been maintained. These comprised 98 pages. IV. Reports Finalised and Presented

3.7 During 2005 the Committee presented the following Report to the House.

38

Sl. No.

Report No.

Subject Presented on

1 59th Review of progress of implementation of assurances 21st December, 2005 V. Summary of Recommendations

(a) 59th Report 3.8 The Committee recommended that the Ministries/Departments of the Government of India should streamline their existing mechanism of monitoring of assurances with a view to liquidating them within the shortest possible time. It observed that timely fulfilment of assurances was critically important, for, if their fulfilment was delayed inordinately, the assurances become irrelevant and lose their significance with the passage of time and their fulfilment gets reduced to a mere technical formality.” 3.9 The Committee observed that in a vast country like ours Non-Government Organisations (NGOs) play diverse roles in various fields and therefore a number of meticulous details need to be analysed before the formulation of the National Policy for NGOs so that it could effectively cater to the needs of vast sections of our society. However, keeping in view the fact that now-a-days the NGOs play a very vital and constructive role in the governance of the nation and in the welfare and development of the society, particularly the weaker sections, the Committee recommended that the matter of the formulation of the National Policy for NGOs should be dealt with a sense of urgency and finalised within the shortest possible time. 3.10 The Committee appreciated the constraints on the Ministry of Defence’s power to dispose of the pending applications for appointment on compassionate grounds since as per the guidelines of Department of Personnel and Training only 5% of the Group C & D vacancies to be filled up through direct recruitment in a given year are available for making appointment on compassionate grounds. But, the Committee observed that, the agonies of the families of the employees who die in harness cannot be ignored. Further, while interacting with some public sector organizations under the Ministry, the Committee observed that those organizations enjoy a fair degree of autonomy in giving appointments on compassionate ground. The Committee also observed that the drive in those organizations to reduce the staff strength and non-recruitment for the last few years could not be compared to the appointments on compassionate ground, which is based on the principles of social security and humanitarian approach. It felt that since, the number of applicants waiting for appointments was quite less, they could be accommodated in those organizations. The Committee, therefore, recommended that the Ministry should put in place a quick decision-making process to sympathetically consider and dispose of the applications for appointment on compassionate grounds. 3.11 The Committee noted that in our country, Primary Health Centres were the cornerstone of rural healthcare system, however, their condition was a cause of concern. The Committee was of the view that all impediments to the upgradation of Primary Health Centres (PHCs) needed to be removed expeditiously to facilitate delivery of better health services to the people of the North East Region including Assam. The Committee, therefore, recommended that the Government should finalize its decision on the upgradation of Primary Health Centres (PMCs) in Assam without further loss of time. 3.12 The Committee noted that our country has made its mark globally in knowledge based resources and services sector and the next should happen in agriculture. The Committee further noted that a very large percentage of fruits and vegetables produced in the country perish in the absence of storage and food processing industries as only a negligible percentage finds its way to these industries. The Committee, therefore, recommended to the Planning Commission to quickly finalise their views on the proposal submitted by the Ministry of Food Processing Industries for liberalisation of assistance for food processing sector so that country could move towards a much awaited and desired sector of economic growth. 3.13 The Committee observed that once a Ministry sends its request for dropping of an assurance, it stops taking extension of time. Since sending a request for dropping does not always mean that the assurance will be dropped, the Ministries/Departments should invariably keep on taking timely extension of time till the time the assurance is dropped by the Committee.

39

3.14 The Committee would like to make it clear that seeking timely extension of time in the event of the pendency of assurances beyond the initial three months and acquainting the Committee with the progress made towards their fulfilment is a sacrosanct Parliamentary practice which should be observed by all Ministries/Departments scrupulously.” V. Secretariat

3.15 The Committee Section – III headed by a Committee Officer constitutes the Secretariat of the Committee. An Additional Secretary, a Director, and an Under Secretary remained in-charge of the Branch. 3.16 To assist the Committee in its work, material received from the Ministries/Departments/Various non-official organizations and individuals was studied from which points were culled out and questionnaires for written replies/evidence prepared for the use of the Committee. 3.17 The Secretariat also collected material for on-the -spot studies and prepared study notes. 3.18 The work relating to drafting, consideration and approval of draft reports by the Committee alongwith their presentation, laying, printing and distribution was also undertaken by the Secretariat. 3.19 The Secretariat also studied material like Parliamentary Debates, answers to Parliamentary Questions etc. relevant to the subjects under examination of the Committee.

40

ANNEXURE III (See Para 3.4)

Details of the sittings of the Committee on Government Assurances during the year 2005

Sl. No.

Date of Meeting

Duration Hrs-Mts.

Subject

1. 3.1.2005 0-50 The Committee considered requests for dropping of Assurances received from various Ministries.

2. 12.1.2005 1-00 The Committee considered requests for dropping of Assurances received from various Ministries

3. 31.1.2005 0-40

The Committee considered requests for dropping of Assurances received from various Ministries

4. 17.2.2005 1- 45 The Committee heard the representatives of the Ministry of Health & Family Welfare in connection with the fulfilment of the assurance pertaining to Unstarred Question No. 2843 dated 15.12.2000 regarding raids for fake drugs in Delhi and on the progress of implementation of other pending assurances of that Ministry.

5. 12.5.2005 0-30 The Committee deferred consideration of memoranda for dropping of assurances listed for the day

6. 2.6.2005 0-30 The Committee deferred consideration of memoranda for dropping of assurances listed for the day

7. 22.6.2005 1-00

The Committee heard the representatives of the Ministry of Petroleum and Natural Gas, Department of Chemicals and Petrochemicals and GAIL (India) Ltd. in connection with the fulfilment of assurance pertaining to Unstarred Question No.1422 dated 17.8.2004 regarding new plants of GAIL and on the progress of implementation of other pending assurances of that Ministry.

8. 5.7.2005 0-45 The Committee considered requests for dropping of Assurances received from various Ministries.

9. 9-9-2005 0-50 The Committee considered requests for dropping of Assurances received from various Ministries

10. 14.10.2005 0-45 The Committee considered requests for dropping of Assurances received from various Ministries

11. 28.10.2005 4-00 The Committee heard the representatives of the Ministry of Communications & Information Technology in connection with the fulfilment of the assurance pertaining to Unstarred Question No. 3579 dated 24.4.2003 regarding Fax/STD/ISD facilities on Panchayats and on the progress of implementation of other pending assurances of that Ministry and also heard the Secretary, Ministry of Tourism in connection with the fulfilment of the assurance pertaining to USQ. No. 96 dated 2.12.2003 regarding tourism potential of Karnataka coastline and on the progress of implementation of all other pending assurances of that Ministry.

12 19.12.2005 0-45 The Committee considered and adopted the 59th Report.

41

CHAPTER-IV

COMMITTEE ON PAPERS LAID ON THE TABLE

I. Composition of the Committee

4. The Committee on Papers Laid on the Table was constituted on the 7th August, 2004 and was reconstituted on the 6th August, 2005. 4.2 The Committee consisted of the following Members: -

COMMITTEE ON PAPERS LAID ON THE TABLE

(Constituted on the 7th August, 2004)

1. Shrimati Syeda Anwara Taimur - Chairperson 2. Shri Eduardo Faleiro 3. Dr. Faguni Ram 4. Shrimati Maya Singh 5. Shrimati Savita Sharda 6. Shri Vijay Singh Yadav 7. Shri Datta Meghe 8. Shri Stephen Marandi 9. Shri M.P. Abdussamad Samadani 10. Shri Varinder Singh Bajwa

COMMITTEE ON PAPERS LAID ON THE TABLE

(Constituted on the 6th August, 2005)

1. Shrimati Syeda Anwara Taimur - Chairperson 2. Dr. Faguni Ram 3. Shrimati Maya Singh 4. Shri Vijay Singh Yadav 5. Shri Datta Meghe 6. Shri M.P. Abdussamad Samadani 7. Shri Varinder Singh Bajwa *8. Shri Surender Lath **9. Shri Ajay Singh Chautala #10. Prof. P.J. Kurian

* Nominated on the 5th September, 2005 in lieu of vacancy caused by the retirement of Shrimati Savita Sharda. ** Nominated on the 6th December, 2005. # Nominated on the 26th December, 2005.

42

II. Subjects selected for examination 4.3 The Committee on Papers Laid on the Table, Rajya Sabha performed the following functions:-

i) Examined the laying of the Annual Reports and Audited Accounts of Government Companies, Public Sector Undertakings, bodies created by Acts of Parliament, Cooperatives, Institutes and Societies framed and financed by the Government;

ii) Examined the delay, if any, in the laying of the Government Notifications/Orders on the Table of Rajya Sabha; and iii) Monitored the implementation by the Ministries of the recommendations of the Committee set out in its various reports of the Committee. III. Review of work done

(a) Sittings of the Committee

4.4 During the year 2005, the Committee held 12 sittings lasting for 19 hrs. and 30 minutes. A statement showing the dates of sittings of the Committee held during the period under review, the duration of the sittings and the subjects discussed are given in Annexure IV. 4.5 The Committee examined 162 cases of requests from the various Ministries regarding grant of extension of time for laying the Annual Reports/Audited Accounts of Government Companies/Organisations under their administrative control and granted extension in 142 cases.

(b) Study Visits

4.6 During the year 2005, the Committee undertook the following local visits to interact with the managements of certain Organizations on matters under its examination. Sl.No. Date of visit Company/Organisation visited Purpose

1. 26.09.2005 Indian Airlines, New Delhi Held discussions with the management of

Indian Airlines Limited regarding delayed laying of papers of Indian Airlines Limited and its subsidiary, Alliance Air.

2. 27.09.2005 (i) All India Institute of Medical Sciences, New Delhi

Held discussions with their managements regarding delayed laying of their papers.

(ii) Central Council for Research in Yoga and Naturopathy, New Delhi

4.7 Verbatim/summary record of proceedings of the sittings of the Committee, at which evidence/clarifications were taken, had been maintained.

IV. Reports presented

4.8 During the year 2005, the Committee presented the following Reports to the House: -

S.No. Report No. Date of Presentation Subject

1. 97th Report

13.05.2005 Sports Authority of India; Hindustan Antibiotics Limited; and Indian Drugs and Pharmaceuticals Limited.

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2. 98th Report

25.08.2005 Government Notifications/Orders and Annual Reports & Audited Accounts of Government Companies/Organizations laid on the Table of Rajya Sabha during the 203rd Session.

3. 99th Report

22.12.2005 Government Notifications/Orders and Annual Reports & Audited Accounts of Government Companies/Organizations laid on the Table of Rajya Sabha during the 204th Session.

4.9 Minutes of the sittings of the Committee on Papers Laid on the Table relating to various Reports presented to the House were prepared and presented to the House alongwith the relevant Reports. V. Summary of Recommendations (a) 97th Report 4.10 The Committee took a serious note of the delay in the laying of Annual Reports and Audited Accounts of the Sports Authority of India (SAI) on the Table of the House. The Committee observed that the Authority had been generally taking 3 to 9 months in compilation of their accounts and submitting the same to the C&AG for audit. The Committee recommended that the Ministry and the Authority should evolve a suitable methodology to ensure that the accounts are promptly compiled i.e. by the 30th June and make them ready for submission to the C&AG for auditing by the beginning of July. The Committee was constrained to note that the late receipt of the audit certificate by the Authority from the C&AG had become a regular feature and the audit certificates for the years 1998-99, 1999-00, 2000-01 were received from the C&AG after 26 month, 11 month and 7 month respectively from the date of submission of the accounts to the C&AG. The Committee, therefore, recommended that the Ministry and the Authority may take up the matter at the highest level with the C&AG so that the delay involved in completion of the audit and furnishing of the audit certificate is minimized. The Ministry must ensure that the audited accounts and audit certificate are received from the C&AG within three months of their submission i.e., by the 30th September. The Committee also recommended the Ministry that in case of delay, the Ministry should furnish the statement of reasons for delay which should invariably contain information in chronological order about the date of finalisation of annual accounts, appointment of auditors, forwarding the accounts to the auditor, completion of audit, submission to C&AG, adoption of report by AGM, completion of translation and printing and forwarding of the papers to the Ministry and such a statement should necessarily be laid along with the delayed laying papers on the Table of the House so as to enable the Committee to identify the stages, causes and extent of delay and suggest remedial measures, wherever required. The Committee further recommended that the Government Review laid on the Table of the House along with the Annual Report and Audited Accounts of the Authority should be comprehensive which should cover broadly the performance of the Authority and contain a brief description of the critical areas of the functioning of the Authority for the year under review. The Committee also impressed upon the Ministry to follow a proper procedure for seeking extension of time and invariably approach the Committee sufficiently in advance for seeking extension of time in case of any delay in the laying of the papers by citing convincing reasons and lay the papers on the Table of the House within the extended period. The Committee emphasised that the SAI as well as the Ministry should prepare a time schedule for each stage involved in the preparation of Annual Reports and Audited Accounts and monitor the same closely so that papers of the SAI are laid on the Table of the House within the prescribed time limit i.e., within nine months from the date of closure of the annual accounts. 4.11 The Committee expressed its displeasure on the fact that there had been persistent delay in the laying of the Annual Reports and Audited Accounts of the Hindustan Antibiotics Limited since the year 1997-98. While the delay for the years 1998-99 to 2000-01 ranged from 2 ½ to 7 months, the delay in respect of the years 1997-98 and 2001-02 had ranged between 11 ½ months and 1 year, 6 ½ months. The Ministry had yet to lay the papers for the years 2002-03 and 2003-04, which should have been laid on the Table of Rajya Sabha by 31.12.2003 and 31.12.2004 respectively. The Committee was dismayed to note that the scrutiny of the dates involved in the preparation and laying of the documents of HAL reveals that nearly 1 ½ to 3 ½ months were taken for the completion of audit by the statutory auditors for the years 1997-98 to 2000-01 while the audit in respect of the year 2001-02 was completed in just 15 days. The Committee recommended that the Ministry of Chemicals and Fertilizers should take up the matter with the statutory auditors and the C&AG for timely completion of audit so that any delay due to non-completion of audit could be avoided and the Annual

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Report along with the Accounts are adopted by the AGM of the Company by the end of September itself. The Committee was distressed to point out that the Hindi translation and printing of the Annual Reports had been a major contributory factor towards the delay. The Company had taken nearly 3 to 5 months for completing the Hindi translation/printing of the Annual Report for the years 1997-98, 1998-99 and 2001-02. The Committee recommended that the requisite steps be taken to ensure that the work of translation and printing of the Annual Reports is done in the shortest possible time. The Committee was astonished to note that in the present conditions existing in the Company, the differences between the Director (Finance) and the Managing Director of HAL on the Statement of Accounts had been unduly protracted that led to inordinate delay in laying of the Annual Report for the year 2002-03. The Committee expressed its unhappiness over this and hoped that the Ministry would make sincere efforts and take timely action to resolve the issue rather than highlighting the differences as reason for delay. The Committee hoped that the Ministry and the Company would take all necessary steps to streamline the procedures so as to avoid any consequential delay in the matter of laying the documents on the Table of the Rajya Sabha. The Committee expressed its deep anguish over the casual approach shown by the Ministry of Chemicals and Fertilizers in seeking extension of time from the Committee and treated it as a routine exercise. The Ministry had approached the Committee three times for seeking extension of time for laying the documents for the years 2001-02 and 2002-03 which clearly reflected that the Ministry did not make any proper assessment of the possible time by which the documents would have been ready for being laid on the Table of the House. The Committee once again impressed upon the Ministry to follow proper procedure for seeking extension of time and approach the Committee sufficiently in advance for seeking extension of time by citing cogent reasons and also indicate clearly the actual time schedule for laying such papers and ensure that papers are laid on the Table of the House within the extended period. 4.12 The Committee observed that there had been unusual delay in laying of the Annual Reports and Audited Accounts of the IDPL on the Table of Rajya Sabha. For the years 1996-97 to 2000-01, the documents had been laid after the delay ranging 1 year, 4 months and 9 days to 2 years, 7 months and 3 days. Further, the papers for the subsequent three years namely, 2001-02, 2002-03 and 2003-04 respectively were still pending to be laid. The Committee expressed its displeasure over the fact that the Ministry had not furnished detailed reasons (date-wise information) for the delay in the laying of papers, inspite of a specific query of the Committee in this regard. The Committee could not identify specific stages at which the delay in the laying of the papers had occurred due to the non-submission of date-wise information by the Ministry. The Committee did not find the explanation given by the Ministry about the shortage of Manpower in Finance Division resulting in delay in finalisation of Annual Accounts satisfactory. The Committee was of the view that the Company could have taken external assistance for finalisation of its accounts and annual reports in time. The Committee was also dismayed that the Ministry had not been actively monitoring the preparation and laying of the documents of IDPL keeping in view the fact that Company was under BIFR and the Ministry was aware of the developments of the Company. The Committee felt that the indifferent attitude and lack of due diligence by the Ministry to follow-up the completion of all the necessary stages involved in the preparation and laying of Annual Reports and Audited Accounts of IDPL had resulted in consistent delay. The Committee recommended sincere efforts should be made to find out the reasons for the delay and proper remedial measures initiated to clear the long pending arrears in the laying of papers. The Committee also observed that there was lot of discrepancy in the information furnished by the IDPL about the average time taken in completion of the stages and the actual laying position of the papers. It reflected lack of seriousness on the part of the IDPL and the Ministry to follow the time table prepared by them in the matter of laying of the Annual Reports and Audited Accounts on the Table of Rajya Sabha. It also appeared that the Ministry had not drawn up any proper schedule or laid down proper guidelines to monitor the timely completion of each stage involved in the finalisation and laying of the Annual Reports and Audited Accounts on the Table of Rajya Sabha. The Committee recommended that the Ministry should strengthen the monitoring mechanism so that delay in the laying of the papers is avoided. The Committee also recommended that the Ministry should henceforth lay a comprehensive delay statement along with Annual Reports and Audited Accounts which should give in chronological order the dates of finalisation of annual accounts, appointment of auditors, forwarding the accounts to the auditors, completion of audit, submission to C&AG, issue of certificate by C&AG, adoption of report by AGM, completion of translation and printing and forwarding of the papers to the Ministry. The Committee further recommended that the Ministry should furnish detailed information while approaching the Committee for extension of time in case of delay in laying of the papers on the Table of the House.

(b) 98th Report

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4.13 The Committee impressed upon the Ministries that in case of delay in the laying of Government Notifications/Orders, a comprehensive delay statement explaining the reasons in detail for the delay in laying of the papers on the Table of the House from the date of publication of the Notification/Order in the Gazette to the actual date of laying on the Table of the House, mentioning the time frame, if any, allowed in the statute should invariably be laid. 4.14 The Committee noted with dismay the delay in the laying of the Annual Reports and Audited Accounts by the concerned Ministries/Departments and directed them to take necessary steps to ensure that the Annual Reports and Audited Accounts of Companies/Organisations functioning under their control are laid on the Table of Rajya Sabha within nine months of the closure of the Annual Accounts. 4.15 The Committee was constrained to note that the accounts for the year 1997-98 were compiled by the Orissa Agro Industries Corporation Limited only on 31.12.2000 after a delay of 2 ½ years and Statutory Auditors were appointed on 10.04.2003 after a delay of five years. After appointing the Statutory Auditors, more than 10 months time was taken in handing over the accounts to the audit. The Committee was not satisfied with reasons furnished by the Ministry and the Corporation that compilation of Accounts were delayed due to shortage of Accounts staff in comparison to the volume of work involved. The Committee, therefore, reiterated its earlier recommendations made in its 82nd, 88th and 91st Reports that the Ministry of Agriculture and Corporation should strictly adhere to the recommendations of the Committee and ensure clearance of all pending reports on priority basis for laying on the Table of the Rajya Sabha. The Committee also directed the Ministry to provide all necessary help to the Corporation to expedite the matter for clearance of all pending reports. 4.16 The Committee expressed its happiness over the efforts made by the Ministry and Super Bazar to lay pending reports for four years from 1998-99 to 2001-02 during the year 2004. The Committee reiterated its earlier recommendation made in its 81st Report (para 11.3) and recommended that the Ministry of Consumer Affairs, Food and Public Distribution should help the Super Bazar in expediting the pending reports and ensure timely laying of papers on the Table of the House in future. 4.17 The Committee was astonished to note the laying position of the Annual Reports and Audited Accounts of the University of Delhi. The Committee failed to understand the reasons as to why the Annual Reports and Audited Accounts of the University for the years 1997-1998 to 1999-2000 were not laid simultaneously on the Table of the House. The delay statement laid along with these reports did not give any details to that effect and was also not in conformity with the Committee's recommendations made in its various reports earlier. It gave an impression as if the Ministry had deliberately avoided to furnish the relevant information with regard to the reasons for delay in respect of these reports. The Committee, therefore, took the matter with serious concern and directed the Ministry of Human Resource Development to provide the information for each year in chronological order stating the date on which the accounts were complied, finalised, date of appointment of auditors, date of forwarding these accounts to the auditors, receipt of audited accounts from the auditors, approval of the Court, date of translation in Hindi and printing of the reports, date of forwarding Annual Reports and Audited Accounts by the Ministry for laying and the time taken by the Ministry in preparing the review and the delay statement. The Committee was constrained to note that Annual Reports and Audited Accounts of the University of Delhi for the years 2000-01 to 2003-04 are yet to be placed before Parliament. The Committee directed the Ministry of Human Resource Development to submit the present status along with reasons for not laying the Annual Reports and Audited Accounts of the University for all these years. The Committee was not at all satisfied with the state of affairs with regard to the laying of Annual Reports and Audited Accounts of the University of Delhi on the Table of the House. Both the Ministry and the University had failed to comply with the directions of the Committee in this regard. The Committee, therefore, impressed upon the Ministry as well as University to streamline the process of preparation of accounts, their audit and the related issues so that accounts and the reports of the University should be laid on the Table of Parliament within the stipulated time. The Committee also directed the Ministry that Annual Reports and Audited Accounts of the University of Delhi should be laid simultaneously on the Table and not separately as is being done at present. The Committee further directed the University and the Ministry to strictly adhere to the recommendations of the Committee and ensure laying of all pending reports on the Table of the House without any further delay. 4.18 The recurring delays in the laying of the Annual Reports and Action Taken Memorandum on the Annual Reports of the National Commission for Scheduled Castes/Scheduled Tribes on the Table of Rajya Sabha was a cause of concern to the Committee. The Committee was constrained to note that the Ministry of Social Justice & Empowerment had not laid a comprehensive year-wise delay statement for the years 1999-2000 and

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2000-01 indicating in chronological order the various stages involved in the preparation of Annual Reports and Action Taken Memorandum on the Annual Reports. The Committee was not satisfied with the reasons furnished by the Ministry that the combined Annual Report and Action Taken Memorandum on the Annual Report for the years 1999-2000 and 2000-2001 could not be laid in time because the circulation of the material of the concerned State Governments and the Central Ministries and compilation of the information received from them was a time consuming exercise for preparing the Action Taken Memorandum on the Annual Report for the years 1999-2000 and 2000-2001. The Committee, therefore, recommended that the Ministry of Social Justice and Empowerment should issue necessary instructions to the concerned State Governments and the concerned Central Ministries to coordinate with the Commission for expediting the finalisation of pending Annual Reports by providing all necessary information well in advance. The Ministry should monitor various stages involved in preparing the Action Taken Memorandum on the Annual Reports and laying the papers on the Table of the House. A time-bound and well-formulated plan of action be chalked out to clear all the pending arrears in the laying of the papers within the shortest possible time. The Committee was distressed to note that inspite of the well established practice, a combined single report had been laid for the years 1999-2000 and 2000-01. The Committee recommended that each report of the National Commission for Scheduled Caste/Scheduled Tribes should cover only one financial year and hoped that in future the Commission will scrupulously follow the Committee’s recommendations. 4.19 The Committee was constrained to note that the Annual Report for the year 1998-99 of the Kerala Land Development Corporation Limited had been received in the Ministry on 09.07.2002 and laid before the State Assembly on 28.01.2003 and the intimation of this fact was conveyed by the Corporation to the Ministry of Water Resources only on 28.08.2004. This action itself reflected that there was lack of coordination between Corporation and the Ministry. The Committee also noted that the Corporation as well as the Ministry of Water Resources failed to adhere to the recommendations of the Committee made in its 87th Report which was presented to the House on 03.03.2002. The Committee, therefore, reiterated its earlier recommendation made in its 87th Report and directed the Corporation and the Ministry to adhere to the same in letter and spirit and ensure clearance of all the pending reports of the Corporation on priority basis for laying on the Table of the House. The Committee also directed the Ministry to provide all necessary help to the Corporation to expedite clearance of all pending reports. 4.20 The Committee directed all the Ministries to furnish a complete list of Government Companies/Organisations/Societies/Institutions, etc. working under their respective administrative control of respective Ministry as also a list of those organizations that are getting Grants-in-aid from the Ministries, whose Annual Reports and Audited Accounts are required to be laid on the Table of the Houses of Parliament under the provisions of various Acts/Statutes along with present position of papers laid or yet to be laid. The Committee hoped that the said information should be made available within six months from the date of presentation of this Report. (c) 99th Report

4.21 The Committee expressed its serious concern that the Annual Reports had not been laid since 1987-88 and was not satisfied with the reasons adduced by the Ministry and the Jammu & Kashmir State Agro Industries Development Corporation Limited for not laying documents for the years 1987-88 and 1988-89. The Committee reiterated its earlier recommendations made in its 76th Report (Paras 7.3 & 7.5) and 91st Report (Para 10.3) and hoped that both Ministry and the Corporation would follow the recommendations in letter and spirit. The Committee observed that no serious steps had been taken by the Corporation and the Ministry to clear the pending reports since 1987-88. The Committee, therefore, directed the Ministry of Agriculture to help the Corporation in laying all the pending Reports expeditiously and ensure laying of all the pending papers of the Corporation on the Table of the House without further loss of time. 4.22 The Committee was distressed to note that the Ministry of Health and Family Welfare had not laid a comprehensive delay statement separately yearwise for the years 1996-97 to 1998-99 as per the recommendations of the Committee. The Committee expressed its serious concern over the fact that there has been recurring delay in the laying of the Annual Reports and Audited Accounts of the Rashtriya Arogya Nidhi (RAN). The Committee observed that the Ministry took more than a year to request the Director of Audit (Central Revenue) for making arrangement for audit of the RAN after its inception on 13.01.1997 and C&AG on its part on the said request for the year 1996-97 to 1998-99 appointed Auditor after six months. After a gap of 1 ½ years, the Accounts were approved by the Treasurer & Member Secretary. The date of certificate by DGACR is 14.8.2000 whereas date of approval and adoption by the Managing Committee is 10.1.2005 i.e. after a delay of 4 ½ years. The Committee was dismayed that the Ministry did not bother to spell out the reasons for inordinate delay in the adoption of the Report by the Managing Committee. The Committee also

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observed that for the year 1999-00 and 2000-01 the approval and adoption of Annual Reports and Audited Accounts by the Managing Committee took more than 2 years after the certificate by DGACR was received and the reasons for this delay have not been explained in the delay statement. The Committee directed the Ministry to take urgent steps to streamline the process of timely laying of the Reports of the RAN on the Table of Rajya Sabha strictly as per the recommendations of the Committee and also recommended that the pending reports of the RAN be laid on the Table of the Rajya Sabha without any further delay. 4.23 The Committee was constrained to note that there had been recurring delay in the laying of the Annual Reports and Audited Accounts of the U.P. Project Corporation Limited. There was considerable delay between submission of Accounts to Statutory Auditors and receipt of Statutory Audit Report and, again, in between receipt of Statutory Audit Report and Receipt of comments of the CAG. No cogent reasons had been given in the delay statement about the causes of this delay. The Committee expressed its displeasure that the Ministry of Water Resources had not given sufficient heed to the recommendations of the Committee regarding proper and timely laying of the papers on the Table of Rajya Sabha as contained in its 78th Report. The Committee, therefore, directed the Corporation and the Ministry to strictly adhere to the recommendations of the Committee and ensure laying of all pending reports on priority basis. 4.24 The Committee expressed its concern that Ministries were not taking due care at the time of preparation of documents for the purpose of laying on the Table of Rajya Sabha. The Committee observed that the delay statement of the Nehru Memorial Museum and Library for the year 2002-03 contained patent errors as it mentions the year 2001-02 instead of 2002-03 in the Stage 1, and the Ministry had not made any effort so far to rectify this error. The Committee had further noted with serious concern that the Annual Accounts for 2001-02 along with Audit Report were adopted on 08.02.2005 i.e. after a delay of 1 year and 10 months from the receipt of the final Audit Report for 2001-02. Similarly, for the year 2002-03, the Annual Report was adopted after six months from the receipt of final Audit Report and no specific reasons had been given for delay in adoption of Annual Reports. The Committee, therefore, directed that the Ministry of Culture should streamline the procedures expeditiously for timely laying of the papers of the Nehru Memorial Museum and Library and also holding the meeting of the Nehru Memorial Museum Society in time to avoid delay in adoption of the Annual Report. The Ministry should also take every possible steps to ensure that such delays do not occur in future and also take all necessary steps to clear the backlog of the laying of the Annual Reports and Accounts at the earliest. 4.25 The directions of the Committee require that a comprehensive delay statement indicating in chronological order the dates of the completion of the various stages involved in the preparation of the Annual Reports and Audited Accounts should be laid on the Table of the House. But in the case of the University Grants Commission the Ministry of Human Resource Development had not laid the comprehensive delay statements along with the Annual Reports for the years 2001-02 and 2002-03. The Committee expressed its displeasure and directed the Ministry of Human Resource Development to prepare a comprehensive delay statement indicating delay in various stages involved in the laying of the papers on the Table of the Houses in future. The Committee observed that the Ministry was not laying Annual Report and Audited Accounts simultaneously. The Committee had time and again directed the Ministries to lay Annual Reports and Audited Accounts simultaneously in order to apprise Parliament of proper functioning of the Organisations. The present pattern of laying papers on the Table of Rajya Sabha was a clear violation of the directions of the Committee. The Committee directed that the Ministry should take utmost care in this regard. The Committee was not at all satisfied with the state of affairs with regard to the laying of Annual Reports and Audited Accounts of the UGC on the Table of the House. The delay statements stated the organisation took considerable time in compiling relevant information. It indicated that the Ministry had not formulated any mechanism to monitor the activity of the organization and also the Ministry had failed to comply with the direction of the Committee given in its 76th Report. The Committee directed the Ministry to provide action taken note of its recommendation within three months of the presentation of this Report. 4.26 The Committee was astonished to note the laying position of the Annual Reports and Audited Accounts of the Delhi Development Authority. The Committee failed to understand the reasons as to why the Annual Reports and Audited Accounts of the Authority for the years 1997-98 to 2000-01 were not laid simultaneously on the Table of the House. The delay statements laid along with these reports did not give any details to that effect. The delay statements submitted by the Ministry were in violation of the Committee’s recommendations made in this regard. The Committee, therefore, called for a detailed explanation in the matter and directed the Ministry of Urban Development and Poverty Alleviation to provide the information for each year in chronological order stating the date on which the accounts were compiled, finalized, date of appointment of auditors, date of forwarding those accounts to the auditors, receipt of audited accounts from the auditors,

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approval by the Board, dates of translation in Hindi and printing of the reports, the date of forwarding Annual Reports and Audited Accounts by the Ministry for laying and the time taken by the Ministry in preparing the review and the delay statement. The Committee was constrained to note that Audited Accounts of the Delhi Development Authority for the years 2001-02 to 2003-04 were yet to be placed before Parliament. The Committee directed the Ministry to submit the present status along with reasons for not laying Audited Accounts of the Authority for all these years. The Committee was not at all satisfied with the state of affairs with regard to the laying of Annual Reports and Audited Accounts of the Delhi Development Authority on the Table of the House. Both the Ministry and the Authority had failed to comply with the directions of the Committee. It seemed that the Ministry had not paid sufficient heed to the recommendations of the Committee contained in its 94th Report (paras 10.3, 10.4 & 10.5). The Committee impressed upon the Ministry as well as the Authority to streamline the procedures for preparation of accounts, its audit and the related issues so that accounts and the reports of the Authority are laid on the Table of Parliament within the stipulated time. The Committee also directed the Ministry that Annual Reports and Audited Accounts of the Delhi Development Authority should be laid simultaneously on the Table and not separately as is being done at present. VI. Secretariat

4.27 The Committee Section-IV headed by a Committee Officer constitutes the Secretariat of the Committee. An Additional Secretary, a Director and an Under Secretary remained incharge of the Branch. 4.28 To assist the Committee in its work, the Annual Reports and Audited Accounts of various Government Companies/Organisations laid on the Table of Rajya Sabha and the material received from the Ministries/Departments/Government Companies/Organisations were studied, on the basis of which points were culled out and questionnaires/memoranda/background notes for evidence/local visits prepared for the use of the Committee.

4.29 The work relating to drafting of reports by the Committee, their consideration and approval alongwith their presentation, laying, printing and distribution was undertaken. The Secretariat also dealt with the work relating to the scrutiny of action taken notes received from the Ministries concerned on the recommendations contained in the Reports of the Committee.

ANNEXURE-IV (See Para 4.4)

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Details of sittings of the Committee on Papers Laid on the Table Sl.No. Date Duration

Hrs. - Mts. Subject

1. 07.01.2005 0-50 The Committee considered the following memoranda: (i) Memorandum No. 1/2005, 2/2005 and 3/2005 - Laying of Annual Reports and Audited Accounts of the Hindustan Machine Tools, Bangalore; Jute Manufacturers Development Council, Kolkata; and Hindustan Copper Limited, Kolkata. (ii) Memorandum No. 4/2005 - Non-laying of Annual Reports and Audited Accounts of Prasar Bharati.

2. 24.03.2005 0-45 The Committee took up for consideration Memorandum No. 5/2005, 6/2005 and 7/2005 regarding laying of Annual Reports and Audited Accounts of the V.V. Giri National Labour Institute, Noida; National Institute of Fashion Technology, New Delhi and Delhi State Industrial Development Corporation Limited.

3. 30.03.2005 1-00 The Committee considered the following memoranda: (i) Memorandum No. 8/2005 - Delayed laying of Annual Reports and Audited Accounts of the Indian Council of Social Science Research, New Delhi; Indian Council of Historical Research, New Delhi and Indian Council of Philosophical Research, New Delhi. (ii) Memorandum No. 9/2005 - Delayed laying of Annual Reports and Audited Accounts of Technology Information, Forecasting and Assessment Council, New Delhi. (iii) Memorandum No. 10/2005 - Delayed laying of Annual Reports and Audited Accounts of the All India Institute of Medical Sciences , New Delhi

4. 28.04.2005 1-10 The Committee considered the following memoranda: (i) Memorandum No. 11/2005 - Delayed laying of Annual Reports and Audited Accounts of the National Board of Examinations, New Delhi. (ii) Memorandum No. 12/2005 - Delayed laying of Annual Reports and Audited Accounts of the Central Council for Research in Yoga and Naturopathy, New Delhi.

5. 11.05.2005 1- 00 The Committee heard the Secretary, Ministry of Health and Family Welfare (Deptt. of AYUSH) and representatives of the Central Council for Research in Homoeopathy in connection with the delayed laying of its Annual Reports and Audited Accounts. The Committee also considered and adopted the 97th Report and decided to present the Report to the House in the Budget Session, 2005.

Sl.No. Date Duration Hrs. - Mts.

Subject

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6. 06.06.2005 00-40 The Committee took up the following memoranda for consideration: (i) Memorandum No. 13/2005 - Delayed laying of Annual Reports and Audited Accounts of the Coal Mines Provident Organisation Fund, Dhanbad. (ii) Memorandum No. 14/2005 - Delayed laying of Annual Reports and Audited Accounts of Visva Bharati, Santiniketan.

7. 24.08.2005 0-55 The Committee considered and adopted the 98th Report and decided to present the Report to the House in the Monsoon Session, 2005.

8. 05.09.2005 1-15 The Committee took up the following memoranda for consideration: (i) Memorandum No. 15/2005 - Delayed laying of Annual Reports and Audited Accounts of the National Institute of Homoeopathy, Kolkata . (ii) Memorandum No. 16/2005 - Delayed laying of Annual Reports and Audited Accounts of State Mission Authority of Nagaland. (iii) Memorandum No. 17/2005 – Delayed laying of Annual Reports and Audited Accounts of Nehru Yuva Kendra Sangathan, New Delhi. (iv) Memorandum No. 18/2005 – Delayed laying of Annual Reports and Audited Accounts of Indian Institutes of Management at Ahmedabad, Kolkata, Indore, Bangalore, Lucknow and Kozhikode.

9. 26.09.2005 4-30 The Committee heard the Secretary, Ministry of Human Resource Development (Department of Secondary & Higher Education) and representatives of Indian Council of Social Science Research, Indian Council of Historical Research and Indian Council of Philosophical Research on the various issues relating to the delayed laying of Annual Reports and Audited Accounts of these three Councils. The Committee then proceeded to the local headquarters of the Indian Airlines Limited, New Delhi and held discussions with the management of the Indian Airlines Limited regarding the delayed laying of the Annual Reports and Audited Accounts of Indian Airlines Limited and its subsidiary, Alliance Air for the years 1999-00 onwards on the Table of Rajya Sabha.

10. 27.09.2005 6-00 The Committee proceeded to the local headquarters of the All India Institute of Medical Sciences, New Delhi and the Central Council for Research in Yoga and Naturopathy, New Delhi and held discussions with their managements regarding the delayed laying of their Annual Reports and Audited Accounts for the years 1999-00 onwards on the Table of Rajya Sabha.

Sl.No. Date Duration Hrs. - Mts.

Subject

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11. 08.12.2005 0-40 The Committee took up the following memoranda for consideration: (i) Memorandum No. 19/2005 - Delayed laying of Annual Reports and Audited Accounts of the Indian Council for Cultural Relations, New Delhi. (ii) Memorandum No. 20/2005 - Delayed laying of Annual Reports and Audited Accounts of the National Institute of Open Schooling.

12. 21.12.2005 0-45 The Committee considered and adopted the 99th Report and decided to present the Report to the House in the Winter Session, 2005.

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CHAPTER-V

COMMITTEE ON ETHICS I. Composition of the Committee 5. The Committee on Ethics was constituted on September 5, 2004 under rule 287 of the Rules of Procedure

and Conduct of Business in the Council of States and was re-constituted on August 6, 2005.

5.2 The Committee consisted of the following Members:—

COMMITTEE ON ETHICS (Constituted on September 5, 2004)

1. Dr. Karan Singh — Chairman 2. Smt. Sushma Swaraj 3. Shri Nilotpal Basu 4. Shri Janeshwar Mishra 5. Shri P. G. Narayanan 6. Shri Ravula Chandra Sekar Reddy 7. Prof. Ram Deo Bhandary 8. Miss Mayawati 9. Shri B. J. Panda 10. Shri Fali S. Nariman

COMMITTEE ON ETHICS

(Constituted on August 6, 2005)

1. Dr. Karan Singh — Chairman 2. Smt. Sushma Swaraj 3. Shri Nilotpal Basu 4. Shri Janeshwar Mishra 5. Shri P. G. Narayanan 6. Shri Ravula Chandra Sekar Reddy 7. Prof. Ram Deo Bhandary 8. Miss Mayawati 9. Shri B. J. Panda 10. *Dr. Bimal Jalan

II. REVIEW OF WORK DONE (a) Sittings of the Committee

5.3 During the period under review the Committee held nine sittings lasting for eleven hours and twenty-five

minutes. A statement showing the dates of sittings of the Committee held during the period under review, the

duration of sittings and the main agenda taken up are given in Annexure-V.

(b) Study Visits — Nil III. Reports Presented —

5.4 During 2005, the Committee presented the following four Reports to the House:-

Sl. No.

Report No. and date of Presentation

Subject

1. Fourth Report (14.03.2005) On Discipline and Decorum in the Council, Declaration of Assets and Liabilities, Register of Members’ Interests and

* Nominated on December 6,2005 vice Shri Fali S. Nariman retired on November 21, 2005.

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reiteration of Code of Conduct.

2. Fifth Report (13.12.2005)

Preliminary Report on the conduct of a Member as shown on a programme entitled “Operation Duryodhan” telecast by a private T.V. channel.

3. Sixth Report (15.12.2005) On the procedure under sub-rule (3) of Rule 293 for giving information contained in the “Register of Members’ Interests’ to the General Public.

4. Seventh Report (23.12.2005) On the conduct of Members as shown on a programme entitled “Operation Duryodhan” by a private T.V. channel.

IV. Summary of Recommendations

4th Report 5.5 The Committee in its Fourth Report had specifically examined the subjects “Declaration of Assets and Liabilities” and “Declaration of Interests” by the Members and deliberated in general on ‘Discipline and Decorum in the Council’, ‘Code of Conduct’ and Committee’s power to recommend sanctions for any unethical behaviour or misconduct of Members and contravention of prescribed Code of Conduct by them. The substantive recommendations made by the Committee in this Report were as follows:

5.6 The Committee identified the following five pecuniary interests on which the information may be furnished by the Members in the prescribed form for registration in the Register of Members’ Interests under sub-rule (1) of Rule 293 of the Rules of Procedure and Conduct of Business in the Council of States: i) Remunerative Directorship ii) Regular Remunerated Activity iii) Shareholding of Controlling Nature iv) Paid Consultancy v) Professional Engagement 5.7 The Committee also dealt with the procedural details to be observed by the Members in furnishing the information and the manner of such information being maintained. The Committee also laid down that every Member shall notify the changes, if any, in the information so furnished by him/her, as on 31st March every year, within ninety days from that date. The same procedure would apply to the Declaration of Assets and Liabilities by the Member under sub-rule (2) of Rule 3 of the Members of Rajya Sabha (Declaration of Assets and Liabilities) Rules 2004. The Committee in its Fourth Report had, while expressing satisfaction over the powers given to it under the Rules of Procedure and Conduct of Business in the Council of States to deal with cases of unethical behaviour of Members or contravention of Code of Conduct or furnishing of incorrect information by them in respect of their interests, emphasized the need for the Code of Conduct being suitably printed in a booklet form and incorporated in the Parliamentary publications being brought out by the Rajya Sabha Secretariat for wider dissemination , apart from this being posted on the Rajya Sabha website for information of general public. 5th Report 5.8 In this Report the Committee examined the conduct of a Member of Rajya Sabha, namely, Dr. Chhatrapal Singh Lodha, arising out of his accepting money for asking questions in the House as shown in a programme entitled ‘Operation Duryodhan’ telecast by a private channel, on this being referred to the Committee by the Hon’ble Chairman, Rajya Sabha through an announcement in the House on December 12, 2005. The Committee after holding preliminary discussions on the subject and taking a serious note of the damage caused to the image of Parliament and the august institution being brought into disrepute, recommended suspension of Dr. Lodha from the House, pending presentation of its final report and an opportunity being given to the Member to explain his position. 6 th Report

5.9 In this report the Committee mainly dealt with the –

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(a) Procedure for giving information contained in the Register of Members’ Interests to general public pursuant to provisions of sub-rule (3) of Rule 293 of the Rules of Procedure and Conduct of Business in the Council of States;

(b) The form and manner of addressing a complaint by a person regarding the alleged unethical

behaviour or breach of Code of Conduct by a Member in terms of the provisions of sub-rule (4) of Rule 295 of the Rules of Procedure and Conduct of Business in the Council of States; and

(c) Requirement of framing of rules to give effect to its mandate and for conducting inquiries either by

itself or by any official acting under its authority, as stipulated in sub-rule (5) of Rule 296 of the Rules of Procedure and Conduct of Business in the Council of States.

5.10 With regard to the item at (b) above, the Committee took the view that since the procedure is already enumerated under Rule 295 of the Rules of Procedure and Conduct of Business in the Council of States , it is not necessary to lay down a fresh procedure. Similarly, with regard to item at (c) above, the Committee decided that since a broad procedure for inquiry is already enumerated in sub-rule (5) of Rule 296, any further elucidation/clarification, as and when required in future, may be dealt with at the appropriate time. The Committee, however, dwelt at length on the procedure to be adhered to in the matter of giving information contained in the ‘Register of Members’ Interests’ to the general public and laid down the broad parameters of this procedure in terms of which the information could be made available to a person with the written permission of the Chairman, Committee on Ethics on such a person submitting an application containing the specified details subject, however, to certain prohibitions on the obtaining or use of the information - (i) for any unlawful purpose, (ii) for any commercial purpose, other than by news and communications media for dissemination to the general public; and (iii) for use, directly or indirectly, in solicitation of money for any political, charitable or other purpose. The Committee in this Report also prescribed certain conditions for public access to the ‘Register of Members’ Interests’ like access being supervised; inquirers being permitted to make notes and a photocopy of a Member’s statement or declaration being supplied to them if requested; access records being maintained in the prescribed manner; and details from the Register not to be provided over the telephone.

7 th Report

5.11 In this report, the Committee in continuation of its Fifth Report on the conduct of Dr. Chhatrapal Singh Lodha, Member, Rajya Sabha as shown in a programme entitled ‘Operation Duryodhan’ telecast by a private channel wherein his suspension from the House had been recommended, dealt with the matter further. The Committee based on the written and oral submissions of Dr. Lodha, the oral submissions of the representatives of Cobrapost.com which conducted the Operation Duryodhan and Aaj Tak which telecast the programme and its viewing of the videotapes and after taking all factors into consideration, reached the conclusion that there was overwhelming and clinching evidence against Shri Lodha of his having acted in a manner which had seriously impaired the dignity of the House and brought the whole institution of Parliamentary democracy into disrepute. Therefore, having found him guilty of gross misconduct inconsistent with the Code of Conduct laid down for Members, the Committee recommended his expulsion from the membership of the House. The Committee in this report also, while taking serious note of the role of corrupt middlemen who act as conduits in murky deals like the present one, and whose misdeeds have the potential to wreck the system from within, recommended that they may be proceeded against under the law by the concerned authorities, after taking legal advice. V. Secretariat 5.12 The Committee on Ethics Section headed by a Committee Officer constitutes the Secretariat of the Committee. A Joint Secretary, a Deputy Secretary and an Under Secretary remained in charge of the Branch.

5.13 The work relating to drafting, consideration and approval of draft reports by the Committee, as also for their presentation, adoption, printing and distribution was also undertaken by the Section.

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ANNEXURE-V (See Para 5.3)

Details of the sittings of the Committee on Ethics during the year 2005.

Sl. No.

Date Duration Hrs.-Mts.

Subject

1. 10.01.2005 35 - 0 Consideration and adoption of the Fourth Report which inter alia identified five pecuniary interests to be declared by members for registration in the ‘Register of Members’ Interest’ under Rule 293 of the Rules of Procedure.

2. 23.08.2005 1 - 30 Laid down the procedure for :-

(i) giving information contained in the Register of Members’ Interests to general public;

(ii) making a complaint to the Committee; and (iii) conducting an inquiry by the Committee.

3. 12.12.2005 1 - 0 (i) Consideration of the reference made to it by Hon’ble Chairman regarding telecasting by a private TV channel of a programme entitled “Operation Duryodhan” showing some Members of Parliament allegedly accepting money for raising questions in the House.

(ii) Consideration and adoption of Draft Fifth Report (Preliminary) recommending suspension of Dr Chhattrapal Singh Lodha, M.P., from the service of the House till the presentation of the final report.

4. 13.12.2005 1 - 0 (i) Consideration and adoption of Draft Sixth Reportregarding procedure for giving informationcontained in the Register of Members Interest togeneral public.

(ii) Further consideration of the reference made to it byHon’ble Chairman regarding telecasting by aprivate TV channel of a programme entitled“Operation Duryodhan” showing some Membersof Parliament allegedly accepting money forraising questions in the House.

(iii) Viewed the VCD received from News Director,Aaj Tak containing the telecast version of theprogramme “Operation Duryodhan” pertaining toDr, Chhattarpal Singh Lodha, MP.

5. 16.12.2005 55 - 0 Consideration of reply of Dr. Chhattrapal Singh Lodha,M.P. and the next course of action to be followed by theCommittee in the matter under consideration.

6. 18.12.2005 3 - 45 Oral submissions of Dr. Chhattrapal Singh Lodha, M.P.and representatives of Cobrapost.com and Aaj Tak in thematter under consideration.

7. 20.12.2005 50 - 0 (i) Consideration of communications of Shri RamJethmalani, MP and Dr. Chhattrapal Singh Lodha,

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M.P. in the matter under consideration.

(ii) To view the VCD containing the unedited versionof the programme “Operation Duryodhan” and alsoto hear the audio recordings of telephonicconversation between representatives ofCobrapost.com and Dr. Lodha.

8. 21.12.2005 1 - 05 Oral submissions of Dr. Chhattrpal Singh Lodha, MP, in the matter under consideration.

9. 22.12.2005 45 - 0 (i) Consideration and adoption of the Seventh Report on “Operation Duryodhan”.

(ii) Consideration of a reference made by the Hon’ble

Chairman on the telecast of “Operation Chakravyuh” by a private TV channel regarding alleged improper conduct of some Members of Parliament in the implementation of MPLAD Scheme.

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CHAPTER-VI COMMITTEE ON COMMERCE

I. Composition of the Committee

6. The Committee was constituted on 5th August, 2004. The following was the composition of the

Committee:

1. Dr. Murli Manohar Joshi Chairman

RAJYA SABHA 3. Dr. T. Subbarami Reddy 4. Shri Thennala G. Balakrishna Pillai 5. Shri Arun Jaitley 6. Shri Abu Asim Azmi 7. Shri Ekanath K. Thakur 8. Shri Dinesh Trivedi 9. Shri Robert Kharshiing 10. Shri N.K. Premachandran 11. Vacant

LOK SABHA

12. Shri K. Francis George 13. Shri D.V. Sadanand Gowda 14. Shri Anant Kumar Hegde 15. Shri Radhey Shyam Kori 16. Shri N.N. Krishnadas 17. Shri Rajaram Pal 18. Shri Ramchandra Paswan 19. Shri Virchandra Paswan 20. Shri Jivabhai A. Patel 21. Shri Jaysingrao Gaikwad Patil 22. Shri Shisupal N. Patle 23. Shri Kashiram Rana 24. Shri Harising Rathod 25. Shri S.P.Y Reddy 26. Shri Bharatsinh Solanki 27. Shri Sarbananda Sonowal 28. Shri C.H. Vijaya Shankar 29. Kunwar Sarvraj Singh 30. #Shri Badiga Ramakrishna 31. #Shri Vikrambhai Arjanbhai Madam 32. Vacant ___________________________________________________________________________________ # Nominated w.e.f 16th November, 2004

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II. Subjects selected for examination 6.2 During 2005, the subjects taken up by the main Committee are as under:- Subject taken up by the Main Committee:

Sr. No.

Subject Taken/Bill Referred

Status

1. Action Taken by Government on the Recommendations/Observations of the Committee contained in Sixty Second Report on Functioning of State Trading Corporation.

Report Presented to Rajya Sabha on 14.03.2005 and Laid on the Table of Lok Sabha on 15.03.2005

2. Action Taken by Government on the Recommendations/Observations of the Committee contained in Sixty Fourth Report on Export of Tea.

-do-

3. Action Taken by Government on the Recommendations/Observations of the Committee contained in Fifty Fourth Report on Foreign Direct investment.

-do-

4. Problems of Coffee Growers

Report Presented to Rajya Sabha on 03.08.2005 and Laid on the Table of Lok Sabha on 03.08.2005.

5. Action Taken by Government on the Recommendations/Observations of the Committee contained in Fifty-fifth Report on ‘Export of Gems & Jewellery’

-do-

6. Cess Laws (Repealing and Amending) Bill,

2005

Report Presented to Rajya Sabha on 08.12.2005 and Laid on the Table of Lok Sabha on 08.12.2005.

7. India and the Sixth Ministerial Report Presented to Rajya Sabha on 09.12.2005 and Laid on the Table of Lok Sabha on 09.12.2005.

8. Floriculture Report Presented to Rajya Sabha on 22.12.2005 and Laid on the Table of Lok Sabha on 22.12.2005.

9. Functioning of SEZs

Examination of the subject by the Committee is in progress.

10. ATN on 61st Report of the Committee on Minerals and Metals Trading Corporation.

The Committee propose to resume examination of the subject.

11. Functioning of Spices Board.

Examination of the subject by the Committee is in progress.

12. Development of Leather Industry The Committee propose to resume examination of the subject.

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III. Review of work done

(a) Sittings of the Committee

6.3 During its term, the Committee held seventeen sittings, lasting thirty-one hours and thirty minutes. A statement showing the dates of sittings of the Committee during the period under review, the duration of each sitting and the subjects discussed are given in Annexure VI. (b) Study Visit

6.4 During the year, the Committee undertook on-the-spot study visit to various institutions/ project sites, etc., as per the details given below, in connection with the following subject under examination:—

Sl. No.

Committee Dates of visits

Places visited In connection with (subjects)

1. Committee on Commerce

19th to 24th January, 2005.

Tripura and Meghalaya

To have First hand information on the status of Spices Industry.

6.5 Verbatim record of proceedings of the sittings of the Committee, at which evidence was taken, was kept. IV. Reports presented

6.6 During the year 2005, the Committee presented/laid the following Reports to the Houses: —

Sl.

No.

Number of the Report (S) and Date of Presentation/Laying in Rajya Sabha Lok Sabha

Subject

1. 67th ___________________________

14.03.2005 15.03.2005

Report on Action Taken by Government on the Recommendations/Observations of the Committee contained in Sixty Second Report on Functioning of State Trading Corporation;

2. 68th ___________________________ 14.03.2005 15.03.2005

Report on Action Taken by Government on the Recommendations/Observations of the Committee contained in Sixty Fourth Report on Export of Tea.

3. 69th ___________________________ 14.03.2005 15.03.2005

Report on Action Taken by Government on the Recommendations/Observations of the Committee contained in Fifty Fourth Report on ‘Foreign Direct Investment’.

4. 70th ___________________________

19.04.2005 20.04.2005

Demands for Grants (2005-2006) of the Department of Commerce (Ministry of Commerce and Industry)

5. 71st ___________________________

19.04.2005 20.04.2005

Demands for Grants (2005-2006) of the Department of Industrial Policy & Promotion (Ministry of Commerce and Industry)

6. 72nd ___________________________

03.08.2005 03.08.2005

Report on ‘Problems of Coffee Growers’

7. 73rd _________________________

03.08.2005 03.08.2005

Report on Action Taken by Government on the Recommendations/Observations of the Committee contained in Fifty-fifth Report on ‘Export of Gems & Jewellery’

8. 74th

Report on ‘Cess Laws (Repealing and Amending) Bill, 2005’

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08.12.2005 08.12.2005

9. 75th ___________________________

09.12.2005 09.12.2005

Report on ‘India and the Sixth Ministerial’

10. 76th ___________________________

22.12.2005 22.12.2005

Report on ‘Floriculture’

6.7 Minutes of sittings of the Committee on Commerce relating to various Reports presented / laid in the Houses were prepared, alongwith the respective Reports.

Summary of Recommendations

(a) 67th Report

6.8 This report is on action taken by Government on the recommendations/observations of the Committee contained in Sixty Second Report on Functioning of State Trading Corporation.

6.9 The STC should finalise the necessary action tie-up with the training institutes, including signing of MOUs, to impart training to its managers to develop the required professional skills.

6.10 The State Trading Corporation should try to find out possibilities of exports in different sectors, especially in the agriculture sector, herbs and herbal medicines. The Export of agriculture produce to African countries would be more competitive and was not likely to pose the sort of barriers, that were being faced in respect of EU countries. Similarly, it should try to explore import potential in the field of other food items like butter, milk, pickles, jams, and horticulture products.

6.11 With regard to post-WTO issues, adherence to phyto-sanitary standards could pay a lot to the nation in the long run and there must be a nation-wide campaign on phyto-sanitary conditions.

6.12 While making any contract in future the Corporation should take adequate care of legal part of the contract to avoid unnecessary legal disputes.

6.13 The actions in the cases in respect of which inquiry reports are under consideration, may be expedited.

6.14 All the pending cases should be finalised expeditiously and no leniency should be shown to the wrong doers. (b) 68th Report

6.15 The Report is on Action Taken by Government on the Recommendations/Observations of the Committee contained in Sixty Fourth Report on Export of Tea.

6.16 All efforts should be made to get early NOC from the Government of Assam and approval from the Ministry of Water Resources in order to complete the remaining phases of diversion of river Brahmaputra.

6.17 Government should consider to mobilize resources from other sources including the World Bank for development of Tea.

6.18 The Tea gardens workers live in unhygienic conditions with poor housing, health care and educational facilities. The Committee are, therefore, of the view that the Ministry of Commerce should take up this issue with Ministry of Labour for appropriate redressal.

6.19 The Tea Board does not posses adequate statutory powers. The Tea Act should be amended so that Tea Board gets required powers so as to function more effectively.

6.20 Government should expedite implementation of the recommendations made in the report of the Inter Ministerial Committee and also their decision on funding the medical services in Tea plantations.

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6.21 The Committee reiterate that there is a need for lowering the Sales Tax rate and this issue needs to be pursued with concerned State Governments. The Committee note that There is a need for lowering the Sales Tax rate and This issue needs to be pursued with concerned State Governments. The Committee note that VAT was expected to be implemented in most of the States w.e.f. 1st April, 2005, and VAT @ 12.5 would be too high and interest of Tea industry would be adversely affected. The issue should be considered in positive perspective to bring down the rate of 12.5 suitably.

6.22 The CIT on Tea is 35%. While persuading the State Governments to lower the Agriculture Income Tax, the Central Government should also think of the ways and means for lowering the CIT, suitably.

6.23 All the schemes to be financed out of the Special Fund created out of Additional Duty of Excise collected, should be finalized expeditiously so that the revival package for closed Tea gardens is taken-up in right earnest. The companies which were mismanaged and had indulged in diverting funds, etc. should be dealt with sternly.

6.24 The Committee reiterate their earlier recommendation that Government should expedite completion of the studies so that all the closed Estates are opened. The employees’ co-operatives and the concerned State Governments should be persuaded to facilitate take-over of closed Tea Estates by the workers’ co-operatives. Substantial amount of money should be paid to the workers to clear their debts. For arrears of payments, a package deal should be decided.

6.25 The Tea Board may consider to include assessment of the ideal manpower requirement of a Tea Estate, in any of its further studies with the involvement of the industry, help the latter to save avoidable expenditure in managing the Tea Estates.

6.26 The Tea Board should take steps for uniform implementation of the Special Tea Term Loan (STTL) package for small growers. The Tea growers, particularly the small growers, be made aware of the STTL package.

6.27 The Tea Board should put in place a mechanism to ensure that financial assistance and the income tax exemption available to the Tea industry to be able to plough back its profits for plantation development and modernisation of Tea factories is actually utilized for the purpose envisaged. A time bound action plan for rejuvenating and modernizing the Tea industry may be formulated, to keep it internationally competitive.

6.28 Government should expedite finalisation of the schemes for domestic promotion of Tea, to be financed out of the Special Fund.

6.29 The process for registration of India Tea logo in various markets as well as for the development of quality logo for the domestic market should be expedited.

6.30 The Tea Board should follow up with the Prevention of Food Adulteration (PFA) Authority the early finalisation of the process for fixation of Maximum Residue Limits in respect of other chemicals and completion of experiments on other chemicals.

6.31 The work relating to conversion of Tea auction centres into electronic auction centres should be completed at the earliest.

6.32 Government should expedite decision on the proposal for declaring Darjeeling Tea growing area as an Agricultural Economic Zone (AEZ) so as to boost exports of Tea from that area.

6.33 Unhealthy practices in Tea Trade have to be checked and also the perpetrators of unhealthy practices have to be booked. Government should explore the ways and means to check the unhealthy practices and to deal with the perpetrators of such practices. However, such measure should not aggravate the difficulties of the exporters and the problems in exports.

6.34 The Committee find that the reasons adduced for not accepting the Committee’s recommendation as untenable in toto. The Committee had recommended for grants for making organic manures, for sprayers, pruning machines, etc. But Government didn’t respond with regard to providing grants for these purposes. Rather, it talked of subsidies for pruning machines only. Government should re-look into the matter and consider to provide grants for organic manures as well as for sprayers, pruning machines, etc.

6.35 The Tea Board should follow-up for approval of the Common Fund for Commodities (CFC), the project for development of organic Tea and finalise its views. 6.36 Government should expedite decision on delegation of powers of all Board officials in the context of enhancing financial sanctioning powers of DTRDC.

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6.37 The proposal for engagement of scientists in DTRDC should be expedited so that research centre’s activities do not suffer any more. Government should also establish close coordination with the Ministry of Agriculture and Department of Biotechnology so that better clones of Tea are produced. The Department may also take up with the Ministry of Agriculture the matter of opening of more Krishi Vigyan Kendras (KVKs) in Tea growing areas, so as to ensure sufficient funds for and give boost to Research and Development activities for Tea. (C) 69th Report 6.38 This Report is on Action Taken by Government on the Recommendations/Observations of the Committee contained in Fifty Fourth Report on Foreign Direct Investment. 6.39 Power is a vital infrastructure for development and for attracting any foreign investor to invest in India all possible steps be taken to see that the availability of power is commensurate to the requirements and that no foreign investor feels disinclined to invest only because of inadequate availability of power. The rates of power should be rationalised and efforts should be made to bring down the cost of power so that electricity could be made available at lower rates.

6.40 The National Electricity Policy as well as the Tariff Policy be finalised at the earliest so that desired thrust could be given to the generation of power. Government should prepare a blue print whereby Non-conventional energy sources like Biomass Power and solar energy should be given a thrust.

6.41 The opening of the telecom sector to the private players has had a positive impact on foreign direct investment in this sector. However, there is huge gap between FDI approvals and actual investment. The Department of Telecommunication should work out a methodology by which the approvals translate into inflows and that the quantum of investment also increases.

6.42 The Committee’s earlier recommendation that Railways should develop as a reliable transporter, compared to the standard of services being provided in other developed/developing countries does not seem to have received adequate attention by the Department. The Committee impress upon Government that the quality and standard of Indian Railways should be further improved and efforts to upgrade to the international standard be accentuated. The Ministry of Railways should ensure that various projects being implemented/to be implemented and the private participation in rail infrastructure should adhere to the time-frame set, so as to strengthen the rail transport infrastructure and to enhance the reliability of rail transport in the eyes of the investors.

6.43 There is a need to further augment the resources for strengthening the national highways network and also to upgrade them to international standard in the minimum possible time. Government should also ensure that the projects presently being implemented by the NHAI are completed in time and are not dragged on beyond the target, so that the vital road network is not a dampener to a foreign investor.

6.44 Though Committee’s recommendations have been accepted by Government, the specific steps taken to effect attitudinal changes in the bureaucracy, have not been enumerated. The major grievance of the foreign investors has been the multiplicity of bodies for approvals of investment and implementation of projects. FIPB is engaged in the field of resolving difficulties of investors, and not in the promotion of FDI, as its name suggests. The Committee feel that a single body, instead of FIPB/FIIA acting separately, would help in reducing bureaucratic obstacles for the foreign investors.

6.45 There is a need for a comprehensive and integrated approach to the development of civil aviation sector and a long term perspective plan, so that our services continue to match the quality of air services provided/to be provided by the international carriers. This will continue to make India a favourable destination for foreign investment

6.46 Government have prepared an ambitious plan for modernisation and expansion of ports and shipping, but it seems that they are not going with it at the required speed, given the time already lost in getting the approval for the Sagar Mala Project. Government should prepare target-oriented and time-bound programmes/projects. In spite of all efforts being made by the Ministry of Shipping, the major drawback is that the lead-time taken by vessels to dock and undock is very high, compared to international standards. One of the major draw back of Indian Ports is the lack of full fledged trans-shipment terminal facilities, leading to opportunity loss due to shipping traffic preferring neighbouring countries like Sri Lanka, South-East and West Asian ports for trans-shipment terminal facilities being available there. Government should take steps to expedite setting up of transhipment facilities for ensuring proper connectivity for global trade, which will eventually attract foreign investment.

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6.47 The tax laws still need to be rationalised considerably into a coherent tax system. Government should carry out regular studies regarding the effect of progressive reduction in Customs Duties in respect of inflow of Foreign Direct Investment (FDI) in the country. 6.48 The speed at which the amendments various Labour Laws are being effected is extremely slow. The required steps towards labour reforms be expedited and some time-limit be fixed to complete the exercise.

6.49 An empowered Sub Committee of the National Development Council on creating “an investor friendly climate” to oversee the process of dismantling of barriers to investments was constituted by the Planning Commission on 31.3.2003. Minister of Commerce and Industry is the Chairman of the Empowered Sub Committee. The first meeting of the Empowered Sub Committee initially scheduled on 23rd August 2003 could not be held. The Committee note that almost despite the lapse of a period of one year there had not been any tangible progress. This might send wrong signals to the prospective foreign investors on the efficacy of such a high powered body.

6.50 There is a need to remain vigilant in respect of entering into multi-lateral agreement on trade and investment-related issues and complacency may cost us dearly.

6.51 A close watch should be kept on the areas in which FDI is being made and the index of development as a result of FDI should be updated regularly.

6.52 The Committee believe that the basic malaise behind stagnation of FDI inflows was plethora of taxes at the Central and State levels, different import duty rates, higher interest rates on loans, etc. The process of reforms in financial sector should be expedited.

6.53 The policy regarding setting up of Special Economic Zones was not clear at present. Government should put in place a proper policy on the setting up of SEZs, as they have the potential of attracting Foreign Direct Investment and ensuring efficient mechanism for proper implementation of the policy with respect to SEZs.

6.54 There must be close linkage and close synergy among various Ministries, Reserve Bank of India and States, to have a very close monitoring and latest information about the FDI inflow. The Ministry of Commerce and Industry being the nodal Ministry, should ensure that all Ministries work in unison, so that the foreign investor faces least hassles

6.55 The forum of Director-General of Foreign Trade for the purpose of settling the doubts in respect of interpretation of the provisions contained in the EXIM policy has not been properly and adequately publicised. The availability of this forum should be given adequate publicity and the notifications being issued in this regard be endorsed to all registered importers and exporters. The strategies adopted in the Foreign Trade Policy be implemented scrupulously.

6.56 In the interest of internal security of the country, it is necessary to keep identifying and having a tab on the source FDI investors. For this purpose, the Ministry of Commerce and Industry will have to maintain a close liaison with the Ministry of Home Affairs and other concerned Ministries. (d) 70th Report 6.57 The Report is on Demands for Grants (2005-06), of the Department of Commerce. 6.58 The Department of Commerce should endeavour to impress upon the Ministry of Finance for early approval of the National Export Insurance Account Scheme.

6.59 A mechanism should be put in place to find out figures of exports effected, country-wise, region-wise and item-wise, as against their respective targets.

6.60 To attain a share of at least 1% in world trade, an enabling environment had to be created, to combat effectively the stiff competition from other global players, as a result of free accessibility to each other’s markets. For this, our Foreign Trade Policy should be implemented vigorously and export strategies should focus on extending helping hand to the exporters. The Government should strive to make constant endeavours to create an appropriate institutional framework for external trade with some important countries of the World, to make India a global hub for manufacturing, trading and services, as stipulated in the Foreign Trade Policy.

6.61 The duties and taxes should not adversely affect our exports. The Department should take up the matter of recovery of income tax liability of exporters, effectively with the Ministry of Finance, especially in view

64

of the strong sentiments of the exporters, for an amicable solution and, if need be, a new scheme in lieu of DEPB should be formulated.

6.62 The Ministry of Commerce, Ministry of Finance and the RBI should have the data as to the exports effected by extending the facilities of duty drawback, as well as through deemed exports.

6.63 The DGCI&S should strive to compile the data in relation to export of services also, so that assistance under the Scheme could be given to the States on the basis of their performance in the export of services.

6.64 The Department of Commerce should hasten the process of launching brand ambassadors network, especially in the US, with a view to provide an impetus to India’s trade and investment relationship with the US & other countries. Adequate funds for this purpose may be provided.

6.65 The scheme of NEIA should be implemented in right earnest, for the benefit of medium and long-term high-value export projects.

6.66 Investors/entrepreneurs should be encouraged to set up their business in the SEZs, in close coordination with the State Governments.

6.67 Pending cases of refund on account of duty drawback on deemed exports should be cleared expeditiously and the Ministry of Finance should be persuaded to make enhanced allocations for the purpose.

6.68 The Committee expressed unhappiness over the slow pace of work in finalization of the Foodgrain Export Subsidy Scheme. No headway seems to have been made. The Committee emphasize the need for early finalization of the Scheme.

6.69 The Department should strive to catalyse the required progress in the AEZs so that the benefits of the scheme are actually realised and exports of agro products are enhanced. The exports from AEZs should meet the requirements of international quality standards. The Department should also ensure to implement incentives like exemption from bank guarantee under EPCG Scheme for units in AEZs for boosting investment in such Zones. Government should expedite notification of duty free import of agriculture equipment under the Export Promotion Capital Goods (EPCG) Scheme, as announced in the Foreign Trade policy. The 12 AEZs sanctioned in September, 2004 should be made functional at the earliest.

6.70 In order to increase export of ornamental fishes, the Aqua Technology Park for Mass Production of Ornamental Fishes should be set up at the earliest. The Department should ensure adequate financial assistance for the purpose.

6.71 In order to assist the Indian Seafood Industry to upgrade their production facilities and the final products, to meet quality requirement stipulated by the importing countries, adequate subsidy/assistance aiming at technology upgradation, value-addition and quality improvement should be provided to MPEDA. Schemes like Development of infrastructure facilities and similar other schemes can improve the working conditions of the workers in the fishing, processing and transporting sectors of the industry, who come from the lower socio-economic strata of the society.

6.72 All out efforts should be made to finalize programmes to tap the marine product potential of maritime States of East Coast. Laboratories for monitoring of shellfish growing waters, etc., in such States be put in place.

6.73 In-house quality control systems and practices should be maintained, for ensuring quality and adherence to international quality standards like HACCP series, etc., so that our exports of seafood are enhanced.

6.74 All laboratories should be well equipped and upgraded to carry out the analysis of antibiotics, pesticide residues and other contaminants in food products. The Department should coordinate with other agencies and research institutions to ensure and monitor adherence to international quality standards.

6.75 The Department should step up their persuasion with the Ministry of Finance to work out a rehabilitation plan for the closed Tea gardens.

6.76 Radical steps are needed to be taken to salvage the Tea industry. The increase in allocation by Rs. 1 crore only, compared to the previous years, appears insignificant. This amount could not be expected to help in any way. The Committee recommend that the allocation for Tea plantation be enhanced substantially.

6.77 The Department should expedite approval of the two schemes of interest subsidy to small and large Coffee growers. There are many more acute problems being faced by the coffee industry. The Coffee industry be provided an emergency bailout package and the Government should find long-term solution for the crisis in Coffee industry.

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6.78 The Department should expedite approval of the proposal for providing incentives to the local bodies for promoting rubberisation of roads. Measures are also required to promote product diversification and non-conventional application of Natural Rubber. The Committee recommend that the observations pending before the CRRI should also be expedited.

6.79 The infrastructure available for marketing of rubber is inadequate and needs to be strengthened. Adequate facilities should be built up for storing rubber by supporting construction of godowns for NR. Information on trends in the market both for NR, rubber products and rubber wood products, have to be disseminated. For this purpose, an efficient market, information system should be put in place, by the appropriate configuration by the information technology. Financial incentives should be provided to the exporters to secure entry of the Indian rubber and rubber wood into the international market.

6.80 Since rubber is relatively a new crop for the North Eastern Region, strong extension support to the farmers should be given, to help them adopt scientific agro- management practices. Financial constraints should not come in the way of rubber plantation development activities in the North East.

6.81 To upgrade our quality of Spices, Department should focus on high-end-value addition, by adopting modern processing technologies and supporting product research for higher value-addition. North Eastern areas could be considered to bring under pepper, large cardamom and herbal spice production.

6.82 Vigorous efforts are also needed for development of high value herbal spices for exports. The agro-climatic conditions prevailing in certain areas of Tamil Nadu, Karnataka, Kerala and North Eastern States are suitable for cultivation of herbal spices like Rosmery, Thyme, Passley and Oregano. Considering the potential of these crops for exports, adequate financial assistance should be provided to the growers. Apart from the food value, the Indian Spices like turmeric, have high medicinal value also. Various steps are needed to improve quality and productivity. The Department should consider to use bio-technology for this purpose. The marketing strategies should be directed to ensure maximum benefits to the spices growers, especially in the North East.

6.83 The Department should bring forth a broad policy for export of organic spices. (para 13.5)

6.84 The vested interests should not be allowed to take precedence in opposing the setting up of the Cashew Board. The Committee, therefore, recommend that Government should take positive and holistic view in regard to setting up of Cashew Board.

6.85 The Government should consider to cover all the growers enrolled under the Price Stabilation Fund Scheme, in the master policy under the Janata Personal Accident Insurance.

6.86 Wide publicity should be given to the Transport Assistance Scheme so as to evoke better response and the funds allocated for the purpose are fully utilised. The functioning of the 4 AEZs set up in North Eastern Region should be monitored closely.

6.87 Export-oriented activities in the North East should be stepped up. Also, the operationalisation of seven export-oriented units, which were at different stages of implementation in North Eastern Region, should be expedited.

6.88 The report of the Committee constituted to look into the functioning of DGCI&S should be finalized at the earliest. At the same time, the Department should make all possible efforts to see that the Directorate becomes a working body in real sense and plays an important and active role, in assessing and making available the marketing scope abroad in respect of different commodities. The Directorate be restructured in such a way that professionally qualified persons are inducted in it.

6.89 Appointments of Commercial Attaches, etc., should be entrusted with the Department of Commerce. The Department of Commerce should take up this matter with the Ministry of External Affairs.

(e) 71st Report 6.90 The Report is on Demands for Grants (2005-06), of the Department of Industrial Policy and Promotion .

6.91 Adequate funds for development of the NE Region, including Sikkim and Special Category States of J&K, HP and Uttaranchal should be made available, otherwise mere declaration of packages by Government would not serve the desired purpose.

6.92 The Government should also consider to extend the Transport Subsidy Scheme to the hilly areas of Andhra Pradesh, Karnataka and Western Ghat region.

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6.93 The Committee note with concern that after a long span of 17 years, only 46 Growth Centres have become operational. The Government should chalk out a holistic strategy for strengthening the Growth Centres and make them an engine of industrial development.

6.94 To ensure proper implementation of the Growth Centres Scheme, substantial allocations will have to be made. The Department should increase the allocations substantially for making this Scheme a success.

6.95 The fate of Tariff Commission should be decided at the earliest . The Committee impress upon the Department to take a decision in the matter, without any more delay.

6.96 Nano-technology has tremendous potential and CMTI should be allocated more funds, especially for R&D projects in the field of Nano-technology. CMTI should also take feed back from various industries which take benefit of technology disseminated by CMTI.

6.97 The Department should ensure that the procedural hassles and the small issues like non-acquisition of land do not come in the way for completion of the projects of IRMRA within the Plan period.

6.98 The Design Policy be formulated at the earliest to bring about clarity in the field of Designs and make India a designer hub in the world. The Government should set up a Design Council at the earliest.

6.99 NPC should devise strategies to inculcate efficient productivity techniques, to help the domestic industry to maximize efficiency in production and minimize wastages.

6.100 Quality Council of India should play a more focused role in propagating the importance of quality to the manufacturers, not only of the products being exported but also of the products sold within the country.

6.101 The Government should consider to set up an institute at National Level, for training the personnel/new recruits to equip them with latest, technical skills in the field of Patents and Trade Marks. This Institute could introduce degree/diploma courses in the fields of biotechnology, bio-Chemistry, Chemistry, Pharma, to equip the examiners with the knowledge and skills required for the examiners.

6.102 Funds in respect a vital areas like the Intellectual Property Regime should not be reduced on small pretexts such as delays in construction of office, delay in computerization, etc. The Department should monitor the progress of the various projects as well as the need for infrastructure for strengthening of the Patent offices.

6.103 The Industrial Infrastructure Upgradation Scheme must be implemented spiritedly, ensuring that employment being provided through this Scheme helps the workforce to upgrade their skills. Special emphasis should be given to latest training courses for the workers.

6.104 The Department should expedite the process for approval/ implementation of the Industrial Infrastructure Upgradation Scheme, as well as subsuming of the 10th Five Year Plan allocation proposed under the Technology Upgradation/Modernisation Scheme.

6.105 The Department should intensify their efforts to get early approval of the Indian Leather Development Programme by CCEA, so that the Leather Sector is able to come up to its full potential.

6.106 The Department should undertake an exercise to integrate and modernize the unorganized sector, engaged in the manufacture of Leather Products and organize workshops for artisans, on the lines similar to the ones being organized for the artisans in the carpet sector, etc.

6.107 Large quantities of skins and hides of dead animals get wasted, particularly in Rajasthan, Gujarat, U.P., Haryana, Andhra Pradesh and Tamil Nadu. More centers for collecting skin, hides, etc. should be opened in those States to help the deprived sections of the Society, which is also necessary for the sake of social justice.

6.108 Zero duty on import of machinery would help the Leather Industry expand to its fullest potential. The Department should, act as a facilitator and approach the concerned Ministries to meet this demand.

6.109 The Department of Explosives should strive to curtail Non Plan expenditure on visits, etc. and use more IT enabled tools like e-mail, internet, etc. If need be, the Department should seek increased Plan allocations.

6.110 Finalisation of the project proposal for formulation of environment friendly fireworks should be expedited so that work on the project starts and is completed in a time-bound manner.

6.111 The National Manufacturing Competitiveness Council, (NMCC) should function in close coordination with the National Productivity Council, as NPC had acquired a lot of expertise in the field of productivity-related activities.

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6.112 Schemes under other NCMP initiative, after completion of necessary formalities, would be started at the earliest, ensuring close monitoring of the Scheme so that the Scheme is implemented within the time limit of five years. (f) 72nd Report 6.113 The Report is on ‘Problems of Coffee Growers’ .

6.114 All-out efforts be made for expansion of the domestic market in the country. Coffee consumption in defence and paramilitary services could be promoted. The Import duty on Coffee vending and brewing machines needs to be abolished, so as to improve the domestic consumption. Marketing cooperatives like Amul and NDDB have a large network and can be in a position to supply quality Coffee at reasonable prices.

6.115 The Department should expedite the proposal of providing interest subsidy to small and large coffee growers during the remaining period of 10th Five Year Plan.

6.116 Research findings of ICAR in other plantation crops could be useful, particularly in the fields of Biotechnology & Tissue Culture, Market-aided Genomic Studies, Quarantine facilities, introduction of exotic of bio control agents, DRIS norms in the Integrated Nutrition Management and development of simulation models for pest and diseased forecasting, etc.

6.117 Government should provide minimum support price to the Coffee growers.

6.118 The Coffee Industry should be given representation on the Board of Trustees of India Brand Equity Fund. 6.119 Government should provide subsidy for plantation. The pesticides, insecticides and machineries necessary to increase productivity be imported and import duty on them should be abolished completely.

6.120 The use of local knowledge in disease control should be effectively encouraged and it should be given wide publicity among Coffee growers. As women can also play an important role in disease control measures, involvement of women-folk in learning the processes should also be undertaken.

6.121 The Relief packages given to other industries, like 25% capital subsidy for starting industry, waiver of stamp duty, rehabilitation of sick industry, tax rebate should be made available to the Coffee industry also.

6.122 Outstanding interest, as on date, on all the loans availed by the Coffee Growers from Commercial Banks and other Financial Institutions should be waived off. Under the ‘Relief package to Coffee Growers’ by Reserve Bank of India, the 2 years moratorium period for repayment, with interest, should be increased to 3 years, without payment of interest. The stipulation to repay 75% of crop loans should be dropped, as the Growers are not in a position to repay any amount, because the rescheduled loans advanced last year were adjusted towards arrears.

6.123 Cooperative banks should follow the RBI directions and rephase all the loans. Fresh crop loans should be advanced in the existing scale of finance and interest should be charged at the NABARD rates. Further, provision should be made for the accounts classified as NPAs, to pay simple interest thereon, to be eligible for Special Coffee Term Loan (SCTL). 6.124 Dialogue among Robusta producing countries to restrict supply should be initiated. There was also a need to switch over to Arabica Coffee. Value-addition for domestic and export markets should be done. Government should consider to set up a new bank i.e., Plantation Development Bank, on the pattern of NABARD, to better help the plantation crops. Coffee industry should be treated as industry like Tourism or IT industry, providing the investment subsidy. 6.125 Government should advise the State Governments to lay down the procedure for permission to cut the trees, so that old and unyielding varieties of Coffee can be replaced with new high-yield Coffee varieties.

6.126 Government should preserve the fragile eco-system in the vicinity of plantations and take steps to reduce the effects of effluents.

6.127 Whenever chicory is mixed in the coffee powder, the product should be labeled, clearly indicating the percentage of Coffee and chicory in the mixture.

6.128 The growers in Karnataka should be encouraged to go for supplemental crops like pepper, cardamom, oranges, bananas, etc.

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(g) 73rd Report 6.129 The Report is on action taken by Government on the recommendations/observations of the Committee contained in 55th Report of the Committee on ‘Export of Gems & Jewellery . 6.130 Vigorous efforts should be made by the Department to explore other countries like South Africa, Belgium, etc. for direct sourcing of rough diamonds. The diplomatic initiatives on the lines of oil diplomacy undertaken by the Government in investing in foreign oil wells, should also be considered. Efforts should also be made for certification for Gems Stones to improve the image of the industry in the international market. The Council should organize training in cutting and polishing of coloured Gems Stones in Orissa where coloured Gems Stones mining have commenced. BIS should step up efforts for getting recognition for Indian hall marking of precious metal Jewellery. Effective and fool-proof mechanism to ensure quality and purity of precious metal, should be put in place to deal with unscrupulous people involved in the jewellery trade.

6.131 The report submitted by A.F. Ferguson & Co. Management Consultants should be implemented seriously to expand our exports for Diamonds, Gems Stones and Jewellery.

6.132 Training coursed offered by training centers of Gems & Jewellery Export Promotion Council should be given adequate recognition.

6.133 The ways & means should be explored to persuade the private sector to take initiative for setting up Jewellery Product Development Centre, Jaipur.

6.134 All types of construction work for augmenting/upgrading facilities at the Jaipur Airport should be completed at the earliest. Formal declaration for making Jaipur Airport as an International Airport be also made at the earliest.

6.135 The existing airport at Surat should upgrade the air facilities in time-bound manner so that the trade gets international exits.

6.136 Department should pursue with other State Governments the matter relating to setting up a center for Gem cutting and processing. State Government of Gujarat should be pursued for getting the recognition of the courses offered by Indian Diamond Institute (IDI) Surat, expeditiously. Matter relating to AICTE accreditation should be expedited.

6.137 Demands such as modification of taxation policy to provide level playing field, exit policy, brand development, forming of consortium of SSIs should be considered favourably.

6.138 Development work pertaining to both phases of SEZ Sitapura, Jaipur should be completed at the earliest.

(h) 74th Report 6.139 The Report is on the Cess Laws (Repealing and Amending) Bill, 2005. The Committee considered the Bill clause-by-clause and approved the Bill and recommend that the Bill be passed.

(i) 75th Report

6.140 The Report is on ‘India and the Sixth Ministerial’.

6.141 The most rational approach will be to ask for the total abolition of domestic subsidies and export subsidies of all kinds in the developed countries.

6.142 All the member countries of the WTO should bind the tariffs in ad-valorem terms, after conversion.

6.143 There should also be harmonization of domestic support with the heavier subsidizing countries, reducing their support level, more than the others.

6.144 Adequate measures/safeguards be provided in the agreement through instruments of Special Products (SP) and Special Safeguard Measures (SSM), to take care of food and livelihood security of the farmers and rural development needs of developing countries.

6.145 Government should increase subsidies on agriculture, without violating WTO laws. It should also protect local market, by appropriate levels of Bound tariff, for food security. Adequate resources should be provided to the resource-starved sector for Growth momentum. Government should fight in Dispute Settlement Board for patenting right of its GI species and plants. It should also fight for Plant Breeders

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Rights. Government should also strive to bring Meaningful Institutional Reforms domestically, taking care to see that these benefits reach the lower rungs of the farming community.

6.146 India should stress on negotiating a suitable definition of special products that appropriately reflect its needs and circumstances. . . . . Every country should be allowed to self-designate Special Products.

6.147 Special Safeguard Measures (SSMs) should cover all agricultural products, including special products. The mechanism for triggering SSMs should be a combination of both the price and volume basis.

6.148 India should insist upon combining all subsidies into single box and slap countervailing duty of equitable amount on all OECD agri-products. . . . . The definition of subsidy in the July Framework is not clear and it saves the interest of developed countries. Hence, Government should clarify the definition of subsidy in the July Framework Agreement.

6.149 Negotiations should fully reflect concerns related to loss in tariff revenues, sensitivity of certain sectors and adjustment costs. The package should help developing countries adjust to the new trade environment, with direct imputs from the developed world in this regard.

6.150 India should not compromise on the general demand that developed countries should not use tariffs on industrial products of export interest to developing countries in labour-intensive sectors as a bargaining chip.

6.151 India should have the flexibility to decide the number of tariff lines they want to commit to reduction in an identified sector. . . . Further, Government should make study on the affected industry due to tariff reduction. India should not agree to any proposal, which asks for increase of tariff bindings to 100% tariffs lines.

6.152 We need to be cautious in bringing down our tariffs due to the cost disability factor of our industry, arising out of stringent rules and regulations, complex administrative procedures, high cost of power, infrastructure, interest, etc, especially for small scale and labour intensive products.

6.153 Our approach should be to first explore the ‘critical mass’ concept, as advocated by US, failing which, to press for voluntary participation (and not mandatory) of developing countries in the sectoral tariff elimination approach. All the non-tariff barriers to trade in goods around the world should be eliminated.

6.154 On services, the developing world should use the G-8 request on General Agreement on Trade in Services (GATS) to pursue an agenda of export promotion among other developing countries. They should formulate offers, based on a clear understanding of both their development and trade implications in sectors, reflecting their interests. . . . . The developing world must make a concerned thrust in this area, for removal of restrictions on cross-border supplies.

6.155 There should not be any numerical limit on the entry of professionals and they should be allowed to provide services as per the prevailing demand conditions in US market. Else, the US needs to give commitment for a higher limit under WTO, so that the market access for our professionals becomes more predictable.

6.156 There should be higher commitments from the developed country members in Mode 4 (movement of professionals) and Mode 1 (trans-border supply) of services. The Visa regulations also need to be eased for movement of professionals. Greater emphasis needs to be laid on mutual recognition of professional degrees by the Member countries. There should be more access for independent professionals and not just inter-company transfers. Member countries of WTO need to remove the economic-need tests for granting work permits. Art IV of GATTS, which is about “Increasing Participation of Developing Countries”, should be effectively implemented in this sector.

6.157 Government to keep in mind the powerful lobbying machines like ‘Coalition of Service Industries’ In USA and ‘European Services Forum,’ in Western Europe. We will need a close inter-action and a well thought-out plan of action, well coordinated between the service sector players and the Indian Government, in order to squarely encounter and challenge the machinations of these huge powerful lobbies.

6.158 In Pharma Sector, India should emphasise on R&D on Newer Products and Novel Drug Delivery Systems. Government should also develop and patent Herbal Medicines and Documentation of Traditional knowledge database should also be done.

6.159 Government should take a position that the TRIPS provisions and the provisions of the Convention on Biodiversity (CBD) should be linked at some stage. This is part of the Doha Round and Government should emphasise on this and take it forward as part of our negotiating process.

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6.160 It would not be appropriate to allow patenting of genetically modified micro-organism. The patenting of micro-organism of any kind i.e. natural or genetically modified or any kind of microbiological processes should be excluded from patenting. In biotechnology area, broad patents should not be allowed and each patent should be confined to a very focussed range.

(j) 76th Report

6.161 The Report is on ‘Floriculture’.

6.162 The majority of floriculture units were not doing well. The development of infrastructure had not kept pace with growth in production. The Committee, therefore, recommend that Government should set up a special task force with the objectives of obliterating the above said drawbacks afflicting the floriculture industry to make it prospective major foreign exchange earner for India. Government should also consider to provide direct air connectivity to the world floriculture marketing centres.

6.163 The concerned banks should take a decision on various aspects of rehabilitation of these units and design an appropriate credit delivery mechanism at the earliest.

6.164 The AEZ for export promotion of floriculture should be set up within a definite time-frame, so that competitive edge and the profits in export of floriculture can be realized in minimum time.

6.165 An agency should be designated to look into and alleviate the apprehensions of growers, to bring in both the breeders and growers to consensus and obtain necessary information from the breeders and propagators, to maintain transparency. Also, a data bank, having full information on the patenting of plant varieties, on the pattern of Traditional Knowledge Digital Library (TKDL) may be considered to be established.

6.166 Mere signing of UPOV ipso facto does not bring in all the agricultural products within its ambit. In most cases, even though individual countries have signed UPOV, they did not include all their agricultural products and applied UPOV only to a few listed products. As such, India needs to apply restraint in extending UPOV to floriculture, since the industry is not ready to have these laws applicable. Before finalizing the list of products where UPOV is expected to be applied, notice be given to the floriculture associations to afford them an opportunity to protect their legitimate rights. APEDA should take active steps to protect the interests of growers against collection of royalties which were transferred to public domain as it (APEDA) had the wherewithal and expertise for putting in place such a mechanism.

6.167 Government must ensure that the protection to any variety is only for a fixed period, from the date of its first sale, as distinct from the date of its first patent in International market, and more particularly, from the date of its patent in any country and its patenting in India.

6.168 The first and the foremost policy change dictated by the past experience is to treat the entire floriculture activity, whether it is catering to local demand or to the international demand, as an agricultural activity and not as an industry……… It is necessary to encourage some of the successful and experienced entrepreneurs to take a lead in forming such consortia. They can also develop satellite farms and operate the existing closed or semi-closed units with a suitable waiver or postponement of their liabilities. This would also necessitate the relief from Land Ceilings Act.

6.169 The other measures include more focussed attention on the locations near Mumbai, Bangalore and Chennai airports, encouraging establishment of viable units of around 7-15 Ha, a very close linkage between Government, research institutions and flower growers, assistance for market development, provision of infrastructure (which is extremely critical for Floriculture), reduction in air freight charges, reduction in interest rates by Banking institutions, waiver of excise duties on domestic sales and very focussed research on key areas. Training and manpower development is also another important area, which will assume criticality in future. The use of information technology, and particularly Internet,for trading should also be promoted.

6.170 A replantation subsidy fund should be set up and made available to the floriculture industry through APEDA. To ensure realization of the fruits of rehabilitation package NABARD should extend refinance to the potential floriculture units.

6.171 Considering the huge potential of this particular industry, it is very necessary that the planting materials are developed within the country. Government should consider taking up this exercise on development of planting material for Roses, Anthuriums, Carnations, Chrysanthemums, Foliage plants, etc., so that they are as good as the products that are expected in the export market. A detailed research programme, in a time-

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bound manner, should be taken up by Government and the funds should not be a constraint for the programme.

6.172 Government should especially address to the problem or importing unregistered pesticides and come up with a solution in terms of organic pesticides and other biological means for, solving the pesticide problems faced by this industry. V. Secretariat

6.173 The Committee Section (Commerce), headed by a Committee Officer, constitutes the Secretariat of the Committee. Additional Secretary, Joint Secretary & Financial Advisor, Deputy Secretary and Under Secretary remained in-charge of the Branch.

6.174 To assist the Committee in its work, the material received from the Ministries/Departments, non-official organizations and individuals was studied and points were culled out and questionnaires for written replies/evidence prepared, for use of Chairman/Members of the Committee.

6.175 The Secretariat also collected material for on-the-spot studies and prepared study notes.

6.176 The work relating to drafting, consideration and approval of draft reports by the Committee, alongwith their presentation, laying, printing and distribution was undertaken. The Secretariat dealt with the work relating to scrutiny of action taken notes received from the Ministries concerned on the recommendations contained in the Reports of the Committee and preparation of Draft Reports on the Action Taken Notes.

6.177 The Secretariat also studied material like Parliamentary Debates, Answers to Parliamentary Questions, Budget Estimates, Plan Documents, Books, Journals, newspapers, etc., relevant to subjects under examination of the Committee.

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ANNEXURE-VI (See Para 6.3)

Details of the sittings of the Committee on Commerce during the year 2005

Sr No.

Date Time duration Subject

1. 10.01.2005 0 - 35 Consideration and adoption of Action Taken Reports on 54th, 62nd and 64th Reports on ‘Foreign Direct Investment’; ‘Functioning of STC’ and ‘Export of Tea’, respectively.

2. 04.02.2005 2 - 20 Oral evidence of Representatives of Consumer Unity and Trust Society (CUTS) and Secretary, Department of Commerce on WTO related issues.

3. 29.03.2005 4 - 00 Consideration of the Demands for Grants (2005-06) pertaining to the Departments of Commerce and Industrial Policy and Promotion.

4. 12.04.2005 0 -50 Consideration and adoption of draft Reports on Demands for Grants (2005-06) of the Department of Commerce and Department of Industrial Policy and Promotion respectively.

5. 25.05.2005 1 -50 Consideration of its future progamme and hearing the views of Shri Changal Reddy, Secretary General, Confederation of Indian Farmers Association.

6. 08.06.2005 0 -50 Consideration and adoption of Action Taken Report on 55th Report of the Committee on Export of Gems and Jewellery and Report on Problems of Coffee Growers.

7. 21.06.2005 1 - 40 Hearing the views of Delhi Exporters Association

8. 5.07.2005 2 - 30 Evidence of witnesses on WTO related issues.

9. 18.07.2005 4 - 30 --do-- 10. 22.09.2005 3 - 50 --do-- 11. 03.10.2005 2 - 20 Evidence of witnesses on WTO related issues and Cess

Laws (Repealing and Amending) Bill, 2005

12. 19.10.2005 1 - 30 Evidence on the Cess Laws (Repealing and Amending) Bill, 2005

13. 28.10.2005 2 - 00 To interact with the Mexican Delegation

14. 24.11.2005 0 - 55 Consideration of the Cess Laws (Repealing and Amending) Bill, 2005 Clause-by-clause

15. 01.12.2005 0 - 40 Consideration and adoption draft of 74th Report on Cess Laws (Repealing and Amending) Bill, 2005 and Consideration of draft 75th Report on ‘India and the Sixth Ministerial’

16. 08.12.2005 0 - 30 (i) Consideration and adoption of draft 75th Report on ‘India and the Sixth Ministerial’.

(ii) Review of the subjects pending before it for examination

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(iii) Consideration of ATNs on the 70th and 71st Reports of the Committee on Demands for Grants (2005-06) of the Department of Commerce and Department of Industrial Policy and Promotion, respectively.

(iv) Taking up the subject of ‘Functioning of Special Economic Zones’ for examination.

17. 21.12.2005 0 - 30 Consideration and adoption of draft 76th Report on ‘Floriculture’

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CHAPTER-VII COMMITTEE ON HOME AFFAIRS

I. Composition of the Committee 7.Consequent upon the amendment to Third and Fifth Schedules of Rules of Procedure and Conduct of Business in the Council of States/Lok Sabha, respectively, the Committee on Home Affairs (2005) was constituted on 5 August 2004 with 10 Members from Rajya Sabha and 21 Members from Lok Sabha. The Committee was re-constituted on 5 August 2005. The Committee on Home Affairs has two Ministries i.e. Ministry of Home Affairs and Ministry of Development of North Eastern Region under its jurisdiction. 7.2 The Committee consisted of the following Members:-

COMMITTEE ON HOME AFFAIRS (CONSTITUTED ON 5 AUGUST 2004)

1. Smt. Sushma Swaraj - Chairperson

RAJYA SABHA

2. Shri V. Narayanasamy 3. Shri Rishang Keishing 4. Shri R.K. Dhawan 5. Shri S.S. Ahluwalia 6. Shri A. Vijayaraghavan 7. Shri N. Jothi 8. Shri Janeshwar Mishra 9. Shri Satish Chandra Misra 10. 1Shri Manoj Bhattacharya 11. 2Shri Vidya Nivas Misra

LOK SABHA

12. Shri L.K. Advani 13. Shri S.K. Bwiswmuthiary 14. Shri C.K. Chandrappan 15. Shri Biren Singh Engti 16. Shri Rahul Gandhi 17. Shri Tapir Gao 18. Shri T.K. Hamza 19. Shri Naveen Jindal 20. Shri Ajit Jogi 21. Shri Tek Lal Mahato 22. Prof. K.M. Kadar Mohideen 23. Shri Sachin Pilot 24. Shri Ashok Pradhan 25. Prof. M. Ramadass 26. Shri G. Karunakara Reddy 27. Shri Bajuban Riyan 28. Dr. H.T. Sangliana 29. Choudhary Bijendra Singh 30. Shri Brij Bhushan Sharan Singh

1 Ceased to be Member w.e.f. 5th September 2004 2 Nominated on 5th September 2004. Ceased to be Member w.e.f. 14.02.2005 on his death.

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31. Shri Braja Kishore Tripathy 32. Shri Beni Prasad Verma

COMMITTEE ON HOME AFFAIRS (CONSTITUTED ON 5 AUGUST 2005)

1. Smt. Sushma Swaraj - Chairperson

RAJYA SABHA

2. Shri V. Narayanasamy 3. Shri Rishang Keishing 4. Shri R.K. Dhawan 5. Shri S.S. Ahluwalia 6. Shri N. Jothi 7. Shri Janeshwar Mishra 8. Shri Satish Chandra Misra 9. 3Shri Sitaram Yechury 10. 4Shri Sanjay Raut

LOK SABHA

11. Shri L.K. Advani 12. Shri S.K. Bwiswmuthiary 13. Shri C.K. Chandrappan 14. Shri Biren Singh Engti 15. Shri Rahul Gandhi 16. Shri Tapir Gao 17. Shri T.K. Hamza 18. Shri Naveen Jindal 19. Shri Ajit Jogi 20. Prof. K.M. Kader Mohideen 21. Shri Tek Lal Mahato 22. Shri Sachin Pilot 23. Shri Ashok Kumar Pradhan 24. Prof. M. Ramadass 25. Shri G. Karunakara Reddy 26. Shri Baju Ban Riyan 27. Dr. H.T. Sangliana 28. Choudhary Bijendra Singh 29. Shri Brij Bhushan Sharan Singh 30. Shri Braja Kishore Tripathy 31. Shri Beni Prasad Verma

II. Subjects selected for examination

3 Nominated w.e.f 25th September 2005 vice Shri A. Vijayaraghavan. 4 Nominated w.e.f. 29th October 2005

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7.3 The Committee on Home Affairs selected the following subjects5 for examination:-

Sl. No.

Ministry/Department Subject

1. Ministry of Home Affairs Police Reforms. 2. Ministry of Home Affairs/ Ministry of

DoNER Internal Security and Economic and Infrastrucural Development in NER.

7.4 The Committee had also taken up for consideration ATRs on Eighty-third Report of the Committee on the personnel policy of CISF and presented its 117th Report on 28 November 2005. 7.5 In addition to the subjects selected /referred, Hon’ble Chairman also referred the following Bills to the Committee for examination:-

Sl.N. Date of reference Name of the Bill 1. 27.05.2005 The Disaster Management Bill, 2005

2. 07.12.2005 The Communal Violence (Prevention, Control and Rehabilitation of

Victims) Bill, 2005

3. 13.12.2005

The Protection of Human Rights (Amendment) Bill, 2005

7.6 Besides this, the Committee had also inherited the Criminal Law (Amendment) Bill, 2003 from its predecessor and presented/laid Report thereon on 2 and 4 March 2005 to/in Rajya Sabha and Lok Sabha, respectively. 7.7 The Committee had also presented/laid its Reports on the Displaced Person Claims and Other Laws Repeal Bill, 2004 and the State Emblem of India (Prohibition of Improper Use) Bill, 2004, referred to the Committee in 2004, to both Houses of parliament. 7.8 The items at Sr. No. (1), (2) & (3) had been considered by the Committee. III. Constitution of Sub-Committees of the Committee on Home Affairs

7.9 During 2005, no sub-Committee was constituted. IV. Review of work done (a) Sittings of the Committee 7.10 Statement showing the dates of sittings of the Committee held during the period under review, the duration of the sittings, the number of Members present and the subjects discussed are given in Annexure VII. 7.11 The Committee had not interacted with any foreign delegation during the period under review. (b) Sitting of Sub-Committees 7.12 During the period under review no sittings of Sub-Committees were held, as no Sub-Committees were constituted. (c) Material and Memoranda furnished to the Committee. 7.13 Voluminous notes/documents were received from the concerned Ministries/Departments on the subjects/Bills and examined by the Committee.

5 Parliamentary Bulletin No. 42516 Part –II, Dated October 19,2005

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7.14 A large number of memoranda were received from the non-officials on different subjects/Bills examined by the Committee. Those Memoranda were sent to the concerned Ministries for their comments. (d) Study Visits: 7.15 The Committee had undertaken study visits to Pondicherry and Andaman & Nicobar Islands from 16 to 23 June 2005 and Chandigarh from 13 to 14 September 2005 as part of its detailed examination of Administration of UTs. 7.16 The Committee did not constitute study groups to make on-the-spot study of local offices, institutions, projects etc. during the period reported upon. 7.17 Seventeen (17) evidences were taken during the period under review and verbatim record of each of the sittings were taken and kept. V. Reports Presented (a) Reports 7.18 During 2005, the Committee presented/laid the following Reports to the Council/House:-

Sl. No. Report No. and Dates of Presentation/Laying

Rajya Sabha Lok Sabha

Subject

1. 111

02.03.2005 04.03.2005 The Criminal Law (Amendment) Bill, 2003

2. 112

20.04.2005 20.04.2005 Demands for Grants (2005-2006) of Ministry of Home Affairs

3. 113

20.04.2005 20.04.2005 Demands for Grants (2005-2006) of Ministry of DoNER

4. 114

27.07.2005 27.07.2005 The Displaced Persons Claims and Other Laws Repeal Bill, 2004

5. 115

25.08.2005 25.08.2005 The Disaster Management Bill, 2005

6. 116

25.08.2005 25.08.2005 The State Emblem of India (Prohibition of Improper Use) Bill, 2004

(b) Action Taken Reports 7.19 An Action Taken Report (117 Report of the Committee) on the Action Taken by the Government on the Recommendation contained in 83rd Report of the Committee pertaining to the Personnel Policy of CISF is presented to both House of Parliament as 28 November 2005. (c) Analysis of action taken by Government on the recommendations of the Committee in its earlier Reports:

Action Taken by Government on earlier Reports of the Committee on Demands for Grants (2004-05)

were examined and the analyses reflected in the Reports on Demands for Grants (2005-06). 7.20 Minutes of sittings of the Committee on Home Affairs relating to all the Reports were presented/laid to the Council/House along with the relevant Reports. VI. Summary of Recommendations

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(a) 111th Report {The Criminal Laws (Amendment) Bill, 2003} 7.21 Under the existing provisions of the IPC punishment is provided for the person giving false evidence. The proposed Section 195A is a step in the direction of giving punishment to the person who threatens/induces the witness to give false statement. The Committee observed that trial could not proceed without making investigation into the aspect of inducement when it comes to the knowledge of the Court. Therefore, it was of the unanimous view that the investigation in such case should be completed within a time frame as to expedite the trial. The Committee also recommended that if an innocent person gets convicted because of false evidence tendered under threat/inducement by anyone then the same punishment which is awarded to the convicted person should be awarded to the person who gave false evidence as also to the person who threatens/induces to do it. 7.22 Regarding amendment of Section 162 of the Cr.PC, the Committee was of the view that the evidential value of the recorded statement before police officer does not change even after getting it signed by the witness. In some situations, it may violate the Fundamental Right of a person enshrined under Article 20 (3), as some of the potential witnesses can be accused also. The Committee apprehended that the provision can be misused by the police thereby increase corruption. Hence, the Committee opposed the provision as it is not a workable proposition. 7.23 The Committee while keeping in mind the views of the witnesses on Plea Bargaining felt that as a pragmatic approach to management of crime and streamlining of the criminal justice administration under a system burdened with three crore pending cases, some dispensations which are fair, just and reasonable can be considered. However, it was of the strong view that the provision of plea bargaining should be introduced only after putting in place the Directorate of Prosecution as envisaged in the Code of Criminal Procedure (Amendment) Bill, 1994 and endorsed by the Committee. It felt that there was no rationale for introducing Plea Bargaining in the absence of the institution of the independent Directorate of Prosecution and empowering the courts to settle the cases through ‘plea bargaining’ in the present set up. 7.24 The Committee wanted express provision in the proposed Section 498A of the Cr.PC for compounding the punishment for relatives of husband too as was the intention of the proposed amendment and recommended necessary amendment in Section 320 of the Cr.PC also. 7.25 The Committee had suggested amendments to the Bill in the light of the deliberations held thereon. The Committee urged the Government to give due consideration to the observations made and amendments proposed by it. The Committee was very keen for revamping of criminal justice system and felt that Government should attempt to bring forward a comprehensive Bill particularly in the light of reports of the various Commissions, Committees and studies on criminal justice system. The Committee was of the view that if that were to take long time, then at least the Code of Criminal Procedure (Amendment) Bill, 1994 and the present Bill may be merged and a composite Bill be introduced in the Parliament rather than introducing piecemeal legislation separately. 7.26 Deliberations took place in the Committee on the urgent need for introducing ‘Police Reforms’ in the light of the widespread allegations of corruption, inaction and politicization of the police force. The Committee urged the Government for immediate initiation of measures for reforming the police system in the country. (b) 112th Report {Demands for Grants (2005-06) of Ministry of Home Affairs} 7.27 The Committee expressed its deep concern over the living conditions in rehabilitation camps of Kashmiri migrants in Jammu and Delhi and Government’s dilemma and lack of clear vision on the future of these migrants. The Committee was of the considered view that the migrants should be sent back to the valley only when adequate security of their lives and properties was ensured. Keeping in view the living conditions in the camps, the Committee felt that Government instead of projecting a saving Rs. 174 crore under Relief and Rehabilitation, should had utilised the full amount allocated under the said head for improving the living condition in these camps. The Committee was also of the view that instead of conducting studies on migrants some concrete steps to improve their living conditions should be taken urgently. 7.28The Committee felt that the scheme of Modernisation of Police Forces was taking proper care for strengthening infrastructure and intelligence network in the States bordering

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Nepal. However, in light of the recent spurt in Maoist violence in Nepal and its percolation to bordering States affected by Naxalism, the Ministry should take special measures to strengthen Policing on the Indo-Nepal Border. 7.29 The Committee also recommended for empowering and strengthening of SSB, the border guarding force on the Indo-Nepal border so as to curb not only the ISI activities through this route but also the Maoist groups in assisting the MCC. It also felt that the Ministry should explore the possibility of amending the Indo-Nepal Treaty so as to make it compulsory for everybody crossing the border to have his identity proof. 7.30 The Committee was of the view that the shortfall of expenditure on preparation of National Register of Indian Citizens and issue of Multipurpose National Identity Cards (MNICs) project having far-reaching ramifications for the maintenance of internal security of the country and useful in many other areas was unacceptable and that the Ministry should take appropriate action to complete the Pilot project at the earliest so that the same may be implemented at the National Level. 7.31 In the light of the fact that the scheme of Modernisation of Police Forces had a significant effect on the morale and strength of the Police Forces of the States, the Committee endorsed the proposal of the Ministry for grant of Rs. 1400 crore for the scheme for the financial year 2005-06 and therefore recommended that an additional allocation of Rs. 500 crore be made during the RE stage. It also directed the Ministry to step up its efforts towards better utilisation of the funds under the scheme by the State Governments and that too with an emphasis on equipping of all the State Police Forces on a balanced scale. The Committee also reiterated its earlier recommendation as contained in its One Hundred and Ninth Report that the States be grouped into two categories only viz. A & B for the purpose of allocation of funds under the scheme. 7.32 The Committee had taken note of the increasing expenditure on the head ‘Police’ which constituted approximately 67 percent of the total budget of the Ministry of Home Affairs. Besides on an average Rs. 800 crore per year is being spent for modernisation of Police Forces of States during the last three years. While endorsing the increased outlay on the Police, the Committee felt that despite the Parliament voting such a large outlay on Police, there was no perceptible improvement in the behavioral and attitudinal aspects of the Police personnel, which needs proper training at all levels. 7.33 The Committee, therefore strongly recommended that the Ministry should initiate sincere efforts towards improving the police-people relationship. It also recommended that an impact analysis of the performance of the Police in terms of crime rate, police-population ratio, satisfaction rate of people with regard to performance of police should be undertaken and all out efforts should be made to improve and enhance the image of the Police 7.34 The Committee had recommended that the Ministry of Home Affairs should step up its efforts to repatriate and rehabilitate Bru refugees on priority basis. 7.35 Considering the unsound financial position of States, the Committee appreciates the decision of the Government to revise the scheme for reimbursing SRE from 50 percent to 100 percent and also the provision for advance release of funds with respect to naxal affected States. However, it also recommended that the Government should enhance the level of reimbursement from 75 percent to 100 percent on the item relating to provision of logistics to the CPFs deployed in naxal affected States as well as to extend the provision for advance release of funds to SRE for North East and J & K. 7.36 The Committee felt that considering the financial position of States affected by insurgency, terrorism and naxalism, the Ministry should fully utilise the budgetary allocation for Special Assistance to States. 7.37 The Committee had taken note of the information furnished by the Ministry with regard to the implementation of various accords in North-East Region. The Committee urged the Ministry to implement the various provisions of these accords which had not yet been implemented as delay in implementation of the same adversely effect the psyche of the people of North East and served as a viable tool in the hands of undesirable elements to carry on a negative campaign against the Government. 7.38 The Committee expresses its serious concern that under the present set up it might not be feasible for the Union Territory Administrations to raise money from open market as recommended by the Twelfth Finance Commission. In such circumstances insufficient budgetary provision might create serious financial crunch for

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the UTs. The Committee, therefore, recommended that keeping in view the financial constraints of the Union Territories, the Ministry should urgently set up enabling institutional mechanism in the Union Territories for facilitating borrowing from open market. 7.39 The Committee, while appreciating the recent efforts of the Government in putting in place a disaster management mechanism at the national level, noted that a lot of exercise has already been done at the Governmental level during the last three years starting from the constitution of the High Powered Committee to the setting up of a Disaster Management Authority. As mentioned by the Ministry, the National Policy on Disaster Management had to pass through several stages before coming to the Cabinet for final approval. The Committee felt that the Ministry should speed up the processes leading to finalisation of the National Policy. Keeping in view the geographical vulnerability and recurrent natural disasters in India, the Committee urged the Ministry to lay the Policy in Parliament at the earliest so that the Disaster Management Authority could immediately implement the same. 7.40 The Committee observed that the pace of preparation for management of manmade disaster was very slow and that no concrete action plan had so far been prepared and that the same should be expedited. 7.41 The Committee, while noting the responsibility of different Ministries for handling different types of disasters under the Allocation of Business Rules, 1961 observed that the allocation of subjects to various Ministries were formulated when there was no such holistic concept of disaster management. Hence, in the light of new developments, the Committee felt that there should be mention in the Allocation of Business Rules of emergency support function of Ministry of Home Affairs to provide necessary logistic and other supports to the different nodal Ministries associated with management of different types of disasters so as to take care of any ambiguity in this important matter. 7.42 The Committee appreciated the efforts being made to give legislative sanction to building bye-laws. The Committee was of the view that guidelines should be issued to the State and Local authorities indicating the parameters for construction of earthquake resistant buildings/structures. 7.43 The Committee while taking note of the savings of Rs. 10.57 crore allocated for disaster management during 2004-05 observed that it belies sincerity on the part of the Ministry and recommended that funds allocated for that important purpose should be utilised properly in the future. 7.44 It appeared quite unusual to the Committee that the work relating to Disaster Management had been transferred to the Ministry of Home Affairs but the Group of Ministers for deciding grants to States from NCCF was headed by Minister of Agriculture. The Committee, therefore, was of the view that the Government might like to review this arrangement for better co-ordination. (c) 113th Report {Demands for Grants (2005-06) of Ministry of DoNER} 7.45 The Committee observed that the policy decision of the Government to stop budgeting of loan component of Central assistance to States by encouraging them to arrange loan from market was a retrograde step for the special category States of the NER. The Committee felt that these States may not be able to raise loans from market, which would resultantly affect their socio-economic development. The Committee was, therefore, of the view that the said policy decision of the Government might be reviewed for the special category States of the NER and recommended that budgetary provisions might be kept at least at the level of BE 2004-05.

7.46 The Committee noted that the pattern of release of funds from Tenth Plan to the Annual Plan of the Ministry of DoNER was uneven. The Committee felt that it should be spread over the years evenly. 7.47 The Committee had expressed its concern with regard to the decision of the Government for not providing ten percent budgetary support of loan component and recommended that the Ministry should pursue with the Ministry of Finance for enhancement of the budgetary allocation by stating the difficulties that might be faced by the NE States in raising loan from the market. 7.48 The Committee noted the trend of constant increase in the utilization of 10 percent of the Gross Budgetary Support of various Ministries/Departments for the development of the NER as was demonstrated by increase in expenditure from 6.71 percent in 1998-99 to 8.34 percent in 2003-04. So far fifteen Ministries/Department were able to spend the total ten percent of their plan budget for the NER. If that trend continues, the corpus fund, which than stood at Rs 3643 crore, would be exhausted within a period of next

81

four to five years. The Committee visualised a situation when 10 percent earmarked funds are fully utilized by the concerned Central Ministries and there would be no funds in NLCPR. The Committee was of the view that the Planning Commission should take note of such a situation and should make some budgetary allocation for smooth implementation of NLCPR projects at that time. 7.49 The Committee while taking note of the inadequate allocations made by the Ministry of Finance expressed its apprehension of the fact that how the Government would be able to meet the basic, immediate and foremost need of the region as committed in CMP, with lower allocations from the NLCPR. The Committee strongly recommended that adequate funds out of the total accruals to NLCPR should be allocated as the utilisation capacity of the Ministry of DoNER had increased from the last year and more money is needed for completion of the ongoing projects in 2005-06. 7.50 The Committee desired that while funds should be enhanced, a special mechanism must be developed for proper and timely implementation of the projects. Officials of the Ministry alongwith the concerned agencies and people’s representatives should devise ways for more effective and purposeful monitoring of the projects. The Committee also desired that the Ministry should pursue with the concerned State Governments for proper implementation of the projects after releasing the funds. The Committee had even gone to the extent of recommending that States, which lagged behind in utilisation of the funds or did not monitor the development of the projects properly, should be penalized while the States, which were doing good work in that regard, should be rewarded. 7.51 The Committee had noted the change in approach with respect to the functioning of the North Eastern Council and urged the Ministry to give due consideration to those factors which enable the North Eastern Council to play an effective role in the development of the North Eastern Region. 7.52 The Committee was happy to note that the BADP had been placed under the jurisdiction of the Ministry of DoNER and observed that the development projects were confined to nodal points of the border Blocks, and areas which were situated very near to the international border had not been included in that programme. 7.53 The Committee further opined that for better development in the border areas, which lie along the international border of the NE States, programmes related to roads, water, medical facility etc., should be given top priority. The Committee also felt that the budgetary allocation of Rs 325 crore for the programme in the NE States should be increased to at least Rs 500 crore. 7.54 The Committee recommended that the Ministry of DoNER in coordination with the Ministry of Tourism should make constant efforts to explore various avenues for development of better tourism related infrastructure to attract tourists, which would provide boost to the sagging economic condition of this region. 7.55 The Committee made a special mention of the Manas Wildlife Sanctuary and felt that the sanctuary alongwith other numerous places of attraction in the region should be developed and the concepts such as Eco Tourism, Ethnic Tourism and Buddhist Monasteries have the potentials to bring this region on the tourist map of the world. 7.56 The Committee while taking note of the efforts of the Ministry regarding the development of Civil Aviation infrastructure including Airports, opined that still a lot more needs to be done to improve the quality of airports for developing better air connectivity. The Committee also suggested that better connectivity of each State of NE would also provide an opportunity for the marketing of cash crops, which are perishable in nature, not only within the NE States but also in the other parts of the country. The Committee, therefore, recommended that all the projects concerning development of civil aviation in this region should be taken up on priority basis and more funds should be allocated for early completion of those projects. 7.57 The Committee noted that upon an analysis of the allocation of money made for maintenance of roads constructed during last two years by NEC i.e, Rs. 14 crore for 6000 km, it works out to Rs. 24 per meter which appears to be meagre as it made the maintenance of road non-feasible. The Committee was, therefore, of the view that keeping in mind the uneven terrain and seasonal variations of the NER, a large sum of money was needed for proper maintenance and further construction of the road network. The Committee had also been apprised of the North East Road Development Project, an externally aided project sanctioned by Asian

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Development Bank (ADB) and the progress made in this regard. The Committee opined that more such progremmes were needed in NER and also recommended that the issue of maintenance and construction of new roads should be taken up with the State PWD for better implementation of the projects specially the North East Express Highway. It also felt that the project should be taken up on priority basis and more funds should be allocated for early completion of the entire road network of the NER. 7.58 The Committee recommended that special allocation needs to be made for the overall development of this region. Planning for these areas should be done keeping in mind the classification of the areas as the Most Backward, Backward and Developing areas. The geographical factors and the seasonal variation should also be taken into account while implementing the projects. Identification of core sectors was also essential, for overall development of infrastructure of the area. 7.59 The Committee was of the view that the implementation of projects was tardy inspite of best efforts made by the Ministry. The Committee in that regard recommended that the Ministry should constantly endeavor to improve upon the monitoring and evaluation mechanism. The Committee even suggested that a nodal office of the Ministry of DoNER might be established in the NER for better monitoring of projects. A strict and regular on-the-spot assessment of the actual implementation should be done by the concerned agencies in the State to ensure proper execution of all the projects. 7.60 The Committee after taking note of the special circumstances prevalent in the NER, recommended that the Ministry should ensure equitable distribution of funds amongst NE states keeping in mind the existing inter-state and intra-state regional disparities, Human Development Indices (HDI) including per capita income, poverty level etc. The Committee further recommended that the entrepreneurs from within the country and outside should be encouraged to invest in the North Eastern Region to speed up the process of its economic development. 7.61 The Committee further took note of the ongoing border trade programme in the States, which was presently taking place from Moreh in Manipur. The Committee suggested that more such centres could be identified so that Border-trade between NE states and neighbouring countries could be strengthened further. The Committee felt that this exercise would not only provide much needed boost to the marketing of agricultural products, which were perishable in nature, but also to the agricultural/horticultural produces, which were in abundance and that would go a long way in providing an opportunity to the related industries to expand their horizons. (d) 114th Report (The Displaced Persons Claims and Other Laws Repeal Bill, 2004) 7.62 The Committee felt that the possibility of existence of unsatisfied verified claims was very low and rare and that the repeal shall not affect any investigation, legal proceeding or remedy in respect of any such right, privilege, obligation, liability, penalty, forfeiture or punishment as aforesaid; and any such investigation, legal proceeding or remedy may be instituted, continued or enforced, and any such penalty, forfeiture or punishment may be imposed as if the repealing Act or Regulation had not been passed. 7.63 The Committee recommended that the Bill be passed in the form in which it had been introduced in the Parliament. (e) 115th Report (The Disaster Management Bill, 2005) 7.64 The Committee recommended insertion of appropriate provisions in the Bill for constitution of Disaster Management Authority in Union Territories. The Committee also recommended that changes which were of consequential nature might be carried out by the Ministry in the Bill in consultation with the Legislative Department. 7.65 In the Autonomous District Council Areas in North Eastern States, many powers including financial powers were vested in CEO of the respective Autonomous District Councils. Therefore, the Committee recommended that the CEO of the Autonomous District Council Area should be nominated as the Co-Chairman of the District Disaster Management Authority in that area. 7.66 The Committee observed that providing of relief to the affected population in the area hit by disaster was an important aspect of the disaster management. The Committee therefore recommended that there should be an officer other than the District Collector or District Magistrate or Deputy Commissioner, designated as

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Relief Commissioner, appointed at the District level to deal exclusively with the relief and rehabilitation work in the disaster affected areas. The Committee also recommended that the District Collector/District Magistrate/Deputy Commissioner being already overburdened, the work of relief and rehabilitation should be entrusted to a dedicated Relief Commissioner so that focussed attention could be given to the relief and rehabilitation work. 7.67 The Committee was of the view that relief and rehabilitation continues much after the disaster has struck and in most of the cases rehabilitation works were required for long periods. The Committee therefore recommended that a Project Implementation Agency (PIA) should be provided for in every State/UT for organised relief and rehabilitation works and for consultation with international aid agencies. Further, it also recommended that people’s representation in such agency should be made mandatory. 7.68 The Committee emphasized on training being made mandatory for all the officers, employees involved in disaster management. 7.69 The Committee while taking note of the reply recommended that the training in Civil Defence should be provided to all the citizens who have attained the age of eighteen years keeping in mind the spirit of Article 51 A (d) of the Constitution dealing with Fundamental Duties. 7.70 The Committee commended the Bill to Parliament for passage, as recommended by it. (f) 116th Report {The State Emblem of India (Prohibition of Improper Use) Bill, 2004} 7.71 The Committee suggested that a prosecuting agency to initiate the proceedings in respect of violation of the provisions of the State Emblem of India should be specially provided in the Act. 7.72 The Committee also suggested that explanation 4 (e) under Section 2 of the Prevention of Insults to National Honour Act, 1971 needed to be suitably amended so as to enable public in general and sports persons in particular to display the Tricolour on headqears, vests, T-shirts, blazers etc. in a respectful manner as is the practice in other countries of the world. 7.73 The Committee was happy to note that the Prevention of Insults to National Honour (Amendment) Bill, 2005 which sought to amend explanation 4(e) of section 2 of the said Act, had been introduced in the Lok Sabha on 22 August 2005. 7.74 The Committee had pointed out that certain states are using the State Emblem of India in their own emblems in a modified way and not conforming to the design set out in the Schedule and called upon the Ministry to appropriately address its concern before bringing the Bill for consideration in Parliament. 7.75 In regard to the Ministry’s Memorandum No. F 24/8/49 – Public dated 23 June, 1949, which was issued prior to the adoption of the Constitution by the Constituent Assembly on 26 November1949 and its enforcement on 26 January 1950, wherein it was clarified that provincial Governments were free to adopt distinctive seals of their own or the Government of India’s seal with such modifications as they may desire, the Committee was of the view that the said Memorandum needed to be reviewed after the enactment of this Bill, so that it was in consonance with the secular ideals enshrined in the Constitution of India. 7.76 The Committee, however, appreciated the move of the Government to bring in a self contained legislation to regulate the use of State Emblem of India and endorsed the Bill. (g) 117th Report (Action Taken Report on the observations/recommendations of the Committee contained in its 83rd Report on Personnel Policy of CISF) 7.78 The Committee noted that its suggestions/recommendations to take care of the grievances of Direct Recruit Group ‘A’ officers of CISF were summarily turned down by the Ministry of Home Affairs. At times the Home Ministry had formulated proposals which had been rejected by DoP&T. In these series of rejections of recommendations/suggestions/proposals, the line of argument of Ministry of Home Affairs and DoP&T had been more or less same. The Committee felt that the present case epitomised the indifferent attitude of the Ministry of Home Affairs and DoP&T towards the recommendations of the Committee and towards finding a solution to the problems of Direct Recruit Assistant Commandants of CISF. The entire episode clearly established the fact that neither Ministry of Home Affairs nor DoP&T were genuinely

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interested in finding a solution to the grievances of the affected batches of Assistant Commandants in CISF, even though they were adhoc in nature, applicable only to the 1987-96 batches of Direct Recruit Assistant Commandants of CISF. This was further manifested by the communication of Ministry of Home Affairs dated 27 May 2005 forwarding the comments of the DoP&T on the ad hoc arrangements proposed by the former. It was interesting to note that the Ministry of Home Affairs has simply forwarded the response of DoP&T like a post office without offering its comments on the subject on which the Committee had been concerned since 1999 and produced no fewer than three reports.

7.79 It was thus evident that the DoP&T has been rejecting all the proposals mooted by the Parliamentary Committee including those made by the Home Ministry citing antiquated rules. The DoP&T had completely overlooked the fact that the whole problem of Direct Recruit Officers of CISF was Government’s own creation. The Committee was convinced that parity, as demanded by the aggrieved officers of CISF, with that of other Group ‘A’ Services was just and reasonable and that the DoP&T had been seen putting impediments by way of rejecting proposals after proposals made by the Committee & the Home Ministry.

7.80 The Committee expressed its serious concern at the dilatory, dilly-dallying and lackadaisical approach of both the Ministry of Home Affairs and Ministry of Personnel, Public Grievances and Pensions (DoP&T) on finding a lasting solution to the grievances of Group ‘A’ Direct Recruit Officers of CISF belonging to 1987-96 batches of Civil Services Examination. The Committee also noted with anguish the way in which both the Ministries had blatantly ignored its recommendations/observations contained in its various Reports since 1999, when the issue was first brought before the Committee. The Committee observed that the latest development had created an impasse. The Standing Committee of Parliament on Home Affairs consisting of Members of both the Houses representing various political parties/groups, had been making unanimous recommendations since 1999 which had been shown the scant regard. This does not augur well for the Committee system in a parliamentary democracy. The Committee, in the totality of the facts and circumstances of the case, recommended that the plight of the 150 odd affected Group ‘A’ Direct Recruit Assistant Commandant of CISF might be placed before the highest authority of the Government i.e. the Union Cabinet for a just and fair solution of the problem to the satisfaction of the aggrieved officers.

VI. Secretariat

7.81 The Committee Section (Home Affairs) headed by Committee Officer constitutes the Secretariat of the Committee. A Joint Secretary, a Deputy Secretary and an Under Secretary remained incharge of the Section with Additional Secretary holding overall charge. 7.82 To assist the Committee in its work, written material received from the Ministries/ various non-official organizations and individuals were studied from which points were culled out and questionnaires were prepared for the use of the Committee. 7.83 The work relating to drafting, consideration and adoption of draft Reports by the Committee along with their presentation, laying, printing and distribution was undertaken. The Secretariat also dealt with the work relating to the scrutiny of action taken notes on the recommendations/observations of the Committee contained in its Reports on Demands for Grants (2004-05) while considering Demands for Grants (2005-06) of the respective Ministries/Departments received from the Ministries/Departments concerned. 7.84 The Secretariat also studied material like Parliamentary Debates, Answers to Parliament Questions, Budget Documents, Five Year Plan Documents, Appropriation Accounts (Civil), Outcome Budget, CAG Reports on accounts of the Union Government (Civil), Books, Journals, Newspapers etc. relevant to the subjects under examination of the Committee. The Secretariat also made use of the material downloaded from the various websites.

ANNEXURE-VII (See Para 7.6)

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DETAILS OF THE MEETINGS OF THE COMMITTEE ON HOME AFFAIRS HELD DURING 2005:

Duration Sl. No.

Date of Meeting Hrs. Mts.

Subjects

1. 06.01.2005 1 - 30 Oral evidence on Criminal Law (Amendment) Bill, 2003: 1. Dr. (Justice) V.S. Malimath, former Chief Justice Karnataka and Kerala High Courts. 2. Dr. N.M. Ghatate, Former Vice Chairman, Law Commission of India

2. 07.01.2005 2 - 30 1. Shri Amit Khemka, Advocate, Delhi High Court 2. Ms. Indira Jaisingh, Sr. Advocate, Supreme Court

3. 18.01.2005 2 - 00 1. (Dr.) Smt. Poornima Advani, Chairperson, National Commission for Women 2. Shri Ram Jethmalani, MP, Rajya Sabha

4. 19.01.2005 1 - 18 Dr. D.R. Kartikeyan, Former Director, CBI

5. 20.01.2005 1 - 20 Shri (Justice) Jaspal Singh, Retd. Judge, Delhi High Court

6. 02.02.2005 1 - 12 Discussion on Criminal Law (Amendment) Bill, 2003

7. 03.02.2005 1 - 40 Clause-by-clause consideration of the Criminal Law (Amendment) Bill, 2003.

8. 17.02.2005 0 - 12 Obituary on the passing away of Shri Vidya Niwas Mishra.

9. 18.02.2005 0 - 20 Consideration and adoption on the draft Report on Criminal Law (Amendment) Bill, 2003.

10. 25.02.2005 1 - 40 Presentations of Home Secretary on the Displaced Persons Claims & Other Laws Repeal Bill, 2004, The State Emblem of India (Prohibition of Improper Use) Bill, 2004 and Presentations of Home Secretary along with Secretary (Personnel) on Action Taken on the Eighty-third Report (Personnel Policy of CISF) followed by Question-Answer session on each item separately.

11. 28.03.2005 5 - 05 Presentation of Home Secretary and Experts on Disaster Management followed by Question-Answer session.

12. 29.03.2005 3 - 44 Presentation of Home Secretary on the Demands for Grants (2005-06) of Ministry of Home Affairs and discussion.

13. 07.04.2005 3 - 20 Presentation of Secretary, Ministry of Development of North Eastern Region (DoNER) on Demands for Grants (2005-06) followed by discussion.

14. 15.04.2005 0 - 25 Consideration and adoption of draft reports on Demands for Grants (2005-06) of Ministry of Home Affairs and DoNER.

15. 20.04.2005 0 - 35 Clause-by-clause consideration of the State Emblem of India (Prohibition of Improper Use) Bill, 2004.

16. 02.06.2005 0 - 55 Discussion regarding the future programme of the Committee.

17. 30.06.2005 1 - 28 (i) Further clause-by-clause consideration of the State Emblem of India (Prohibition of Improper Use) Bill, 2004; and clause-

by-clause consideration of the Displaced Persons Claims and Other Laws Repeal Bill, 2004.

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18. 01.07.2005 2 - 20 Presentation of Commissioner of Police, Delhi on Law & Order Situation in the National Capital Territory of Delhi with special reference to recent incidents of crime against women.

19. 11.07.2005 2 - 05 Adoption of draft 114th Report on the Displaced Persons Claims and Other Laws Repeal Bill, 2004 consideration of the Memorandum on the Personnel Policy of CISF and presentation of Home Secretary on the Disaster Management Bill, 2005.

20. 20.07.2005 1 - 19 Discussion regarding the future course of action in relation to the State Emblem of India (Prohibition of Improper Use) Bill, 2004 and discussion on the Disaster Management Bill, 2005.

21. 22.08.2005 1 - 00 Further clause-by-clause consideration of the State Emblem of India (Prohibition of Improper Use) Bill, 2004 and adoption of draft Report thereon and also clause-by-clause consideration of the Disaster Management Bill, 2005 and adoption of the draft Report thereon.

22. 12.09.2005 0 - 20 Consideration of the Study Note on the visit of the Committee to Pondicherry, Nagapattinam and Andaman & Nicobar Islands from 16-23 June, 2005.

23. 18.10.2005 0 - 25 (i) Consideration and adoption of draft One Hundred & Seventeenth Report; and (ii) Consideration and adoption of Study Note on the visit to Chandigarh from 13 to 14 September, 2005

24. 27.10.2005 3 - 10 Evidence of representatives of Ministry of Home Affairs & Chief Secretaries of Andaman & Nicobar Islands & Pondicherry on the “Administration of UTs.”

25. 08.11.2005 1 - 35 Evidence of representatives of Ministry of Home Affairs & Advisor to Administrator, Chandigarh Administration on the “Administration of UTs.”

26. 18.11.2005 2 - 55 (i) Presentation of CHRI (Commonwealth Human Rights Initiative) on Police Reforms in India; and

(ii) Presentation of Shri Arvind Mehta on Police Reforms in India

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CHAPTER-VIII

COMMITTEE ON HUMAN RESOURCE DEVELOPMENT

I. Composition of the Committee 8. The Department-related Parliamentary Standing Committee on Human Resource Development was reconstituted on the 4th August, 2005 in the year 2005. The first meeting of the newly constituted Committee was held on the 4th August, 2005. The Committee consisted of the following Members: —

COMPOSITION OF THE COMMITTEE

(As on 1st January 2005) RAJYA SABHA

1. Shri Vayalar Ravi Chairman 2. Shri Eduardo Faleiro 3. Shri Dwijendra Nath Sharmah 4. Shri Ravi Shankar Prasad 5. Shrimati Chandra Kala Pandey 6. Shri S. Anbalagan 7. Shri Uday Pratap Singh 8. ^Smt. Vanga Geetha 9. *Shri M.P. Abdussamad Samadani 10. Prof. Ram Deo Bhandary 11. Shri Anil Dhirubhai Ambani

LOK SABHA

12. Shri Basudeb Barman 13. Shri Hari Sinh Chavda 14. Shri G.V. Harsha Kumar 15. Shri R. L. Jalappa 16. Shri Ramswarup Koli 17. Shri Manjunath Kunnur 18. Shri Y.G. Mahajan 19. Shri Manoj Kumar 20. Shri Babu Lal Marandi 21. Dr. Thokchom Meinya 22. Shri Krishna Murari Moghe 23. Mohd. Mukim 24. Shri Tukaram Ganpatrao Rengepatil 25. Prof. Rasa Singh Rawat 26. Shri M. Rajamohan Reddy 27. Shri Tufani Saroj 28. Smt. P. Satheedevi 29. Shri A.R. Shaheen 30. Smt. Jyotirmoyee Sikdar 31. Shri K. Virupaxappa 32. Shri Devendra Singh Yadav ------------------------------------------------------------------------------------------------------------------------------ ^ Ceased to be member w.e.f. 13th December, 2004. * Nominated w.e.f. 13th December, 2004.

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COMPOSITION OF THE COMMITTEE (Constituted on 4th August, 2005)

Shri Vayalar Ravi Chairman

MEMBERS RAJYA SABHA

1. Shri Dwijendra Nath Sharmah 2. *Shri Shantaram Laxman Naik 3. Shri Ravi Shankar Prasad 4. **Shrimati Chandra Kala Pandey 5. ^ Shrimati Brinda Karat 6. Shri S. Anbalagan 7. Shri Uday Pratap Singh 8. Shri M.P. Abdussamad Samadani 9. Prof. Ram Deo Bhandary 10. Shri Anil Dhirubhai Ambani

LOK SABHA

11. Shri Basudeb Barman 12. Shri Hari Sinh Chavda 13. Shri G.V. Harsha Kumar 14. Shri R. L. Jalappa 15. Shri Ramswarup Koli 16. Shri Manjunath Kunnur 17. $Shri Y.G. Mahajan 18. $Shri Manoj Kumar 19. Shri Babu Lal Marandi 20. Dr. Thokchom Meinya 21. Shri Krishna Murari Moghe 22. Mohd. Mukim 23. Shri Tukaram Ganpatrao Rengepatil 24. Prof. Rasa Singh Rawat 25. Shri M. Rajamohan Reddy 26. Shri Tufani Saroj 27. Smt. P. Satheedevi 28. Shri A.R. Shaheen 29. Smt. Jyotirmoyee Sikdar 30. Shri K. Virupaxappa 31. Shri Devendra Singh Yadav

-------------------------------------------------------------------------------------------------------------------------------

*nominated w.e.f .23.8.2005 ** Ceased to be a member of the Committee on expiry of her term in Rajya Sabha w.e.f. 18th August, , 2005 ^nominated w.e.f. 25.9.2005 $ Ceased to be member w.e.f. 23rd December, 2005.

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II. Subjects selected for examination 8.2 The Committee on Human Resource Development selected the following subjects for examination:

Sl.No. Ministry/Departments Subjects

1. Department of Elementary Education and Literacy

Problems being faced in implementation of centrally sponsored schemes vis-a-vis Mid Day Meal Scheme and Sarva Shiksha Abhiyan

2. Department of Women and Child Development

Problems being faced in implementation of centrally sponsored schemes vis-a-vis Integrated Child Development Service(ICDS) Scheme

3. Department of Secondary and Higher Education

Functioning of Kendriya Vidyalayas

4. Department of Secondary and Higher Education

Functioning of Navodaya Vidyalayas

5. Department of Secondary and Higher Education

University and Higher Education

6. Ministry of Youth Affairs and Sports Promotion of Sports 8.3 Besides this, the following Bills were considered by the Committee which were referred to the Committee by Hon’ble Chairman / Hon’ble Speaker for examination and report.

S.No. Date of reference Name of the Bill 1. 27.12.2004 University of Allahabad Bill, 2004 2. 06.05.2005 University of Manipur Bill, 2005 3. 27.05.2005 Commissions for Protection of Child Rights Bill, 2005 4. 24.08.2005 National Commission for Minority Educational Institutions

(Amendment) Bill, 2005 III. Constitution of Sub-Committees of the Department-related Parliamentary Standing Committee on

Human Resource Development 8.4 No Sub-Committee was constituted during the year 2005.

IV. Review of work done (a) Sittings of the Committee

8.5 During the year, 2005, the Committee held thirty sittings lasting over 68 hrs 20 minutes. A statement showing the dates and duration of each sitting of the Committee, as also the subjects discussed during this period are given in Annexure VIII. (b) Sittings of Sub-Committees

8.6 No Sub-Committee was constituted during the period under review. (c) Study Visits: -

Sl.No

Name Places of visit Dates Organisation Examined

Purpose

1.

Department-related Parliamentary

Local visit to Dr. Shyama Prasad

27th January, 2005

Ministry of Youth Affairs and Sports

To see the infrastructure facilities available at these stadia.

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Standing Committee on Human Resource Development

Mookherjee Swimming Pool Complex and Jawaharlal Nehru Stadium -New Delhi

The Committee also visited the newly developed Dope Centre, Medical Care Centre, Human Performance Lab, Existing Dope Control Lab and the Residential wing at the Jawaharlal Nehru Stadium.

2. Department-related Parliamentary Standing Committee onHuman Resource Development

Bhopal-Mumbai-Thiruvanantha-puram

14th to 19th February 05

1.Ministry of Youth Affairs and Sports 2. Department of Secondary and Higher Education

During its visit the Committee visited, sports complexes and training institutes where it held discussion with the stakeholders in Indian sports at these places. The Committee visited Sports Authority of India (SAI) Regional Centre at Bhopal and held discussion with the coaches, sports person, representa-tives of sports federations and State Govt. At Mumbai the Committee interacted with the cross section of the higher education community including Vice-Chancellors, teachers, students, non-teaching staff and the other experts in the field. The Committee held deliberations with the representa-tives of various sports federations/ associations based in and around Mumbai and visited SAI Training Centre, Kandivali at Mumbai. The Committee then visited sports complexes at Kollam and Thiruvananthapuram. Held discussion with sportspersons, coaches etc. at Laxmibai National College of Physical Education. The Committee also held discussion with academic community in Thiruvananthapuram.

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3. Department-related Parliamentary Standing Committee on Human Resource Development

Srinagar and Leh

14th to 18th July 05

1.Ministry of Youth Affairs and Sports 2. Department of Secondary and Higher Education 3. Department of Women and Child Development

During the visit theCommittee visited 5-6primary schools to seeeducation infrastructurefor the children and alsofor working of Mid DayMeal Scheme. TheCommittee visitedAnganwadi Centres,Nehru Yuva KendraSangathan both inSrinagar and Leh andheld discussions with theState Governmentofficials, NGOs, implementingagencies and other stakeholders and got usefulfeedback on thepractical difficultiesfaced by them inimplementation ofcentral schemes likeSarva Shiksha Abhiyanand Mid Day MealScheme of Departmentof Elementary Educationand Literacy, IntegratedChild DevelopmentServices (ICDS) ofDepartment of Womenand Child Developmentand Nehru Yuva Kendrasof Ministry of YouthAffairs and Sports.

4. Department-related Parliamentary Standing Committee on Human Resource Development

Imphal-Guwahati,

Itanagar and Kolkata

6th to 13th November 2005

During the visit theCommittee helddiscussions with theState Governmentofficials on the practicaldifficulties faced by themin implementation ofcentral schemes likeSarva Shiksha Abhiyanand Mid Day Meal ofDepartment ofElementary Educationand Literacy, IntegratedChild DevelopmentServices (ICDS) ofDepartment of Womenand Child Development.The Committee visitedprimary schools, andAnganwadi centers inremote villages inArunachal Pradesh,Manipur, Assam & West

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Bengal. 8.7 Verbatim record of proceedings of the sittings of the Committee, at which evidence was taken, was maintained. V. Reports presented (a) Reports 8.8 During 2005, the Committee presented the following Reports to the House: —

Sl. No.

Number of Report and date of presentation/ laying of Report

Report

1. 154th 3.3.2005(RS) 2.3.2005(LS)

Functioning of Navodaya Vidyalayas of the Department of Secondary and Higher Education (Ministry of Human Resource Development)

2. 158th 21.4.2005

Demands for Grants (2005-06) of the Department of Elementary Education and Literacy (Ministry of Human Resource Development)

3. 159th 21.4.2005

Demands for Grants (2005-06) of the Department of Secondary and Higher Education (Ministry of Human Resource Development)

4. 160th 21.4.2005

Demands for Grants (2005-06) of the Department of Women and Child Development (Ministry of Human Resource Development)

5. 161st 27.4.2005

University of Allahabad Bill, 2004 of the Department of Secondary and Higher Education (Ministry of Human Resource Development)

6. 162nd 28.4.2005

Functioning of Kendriya Vidyalayas of the Department of Secondary and Higher Education (Ministry of Human Resource Development)

7. 163rd 6.5.2005

Demands for Grants (2005-06) of the Ministry of Youth Affairs and Sports

8. 164th 27.7.2005

Manipur University Bill, 2005, of the Department of Secondary and Higher Education (Ministry of Human Resource Development

9. 165th 18.8.2005

The Commissions for Protection of Child Rights Bill, 2005, of the Department of Women and Child Development (Ministry of Human Resource Development)

10. 166th 24.8.2005

Report of the Department-related Parliamentary Standing Committee on Human Resource Development on Action-Taken by Government on the recommendations/observations contained in its 153rd Report on Gender Budget Analysis of the Department of Women and Child Development (Ministry of Human Resource Development)

11. 167th 6.12.2005

Report on the National Commission for Minority Educational Institutions (Amendment) Bill, 2005 of the Department of Secondary and Higher Education (Ministry of Human Resource Development

(b) Action Taken Reports 8.9 The following Reports on Action Taken Note were presented to the House during the period under review: —

Sl. No.

Number of Report and date of presentation/laying in Rajya Sabha/Lok Sabha

Subject

1. 155th

3.3.2005(RS) Report on Action Taken by the Department of Elementary Education and Literacy on the recommendations/observation

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2.3.2005(LS)

contained in One Hundred-Forty-ninth Report of the Committee on Demands for Grants (2004-05) of the Department of Elementary Education and Literacy (Ministry of Human Resource Development)

2. 156th 3.3.2005(RS) 2.3.2005(LS)

Report on Action taken by the Department of Women and Child Development on the recommendations/observations contained in One Hundred Fifty-first Report of the Committee on Demands for Grants (2004-05) of the Department of Women and Child Development (Ministry of Human Resource Development)

3. 157th 23.3.2005

Report on Action Taken by the Ministry of Youth Affairs and Sports on the recommendations/observations contained in One Hundred Fifty-Second report of the Committee on Demands for Grants (2004-05) of the Ministry of Youth Affairs and Sports

4. 168th

13.12.2005

Report on Action Taken by the Department of Secondary and Higher Education on the recommendations/observations contained in One Hundred Fifty-ninth Report of the Committee on Demands for Grants, 2005-06 (Demand No. 58) of the Department of Secondary and Higher Education (Ministry of Human Resource Development)

5. 169th 13.12.2005

Report on Action taken by the Ministry of Youth Affairs and Sports on the Recommendations/observations contained in One Hundred Sixty-third Report of the Committee on Demands for Grants, 2005-06 (Demand No. 105) of the Ministry of Youth Affairs and Sports

6. 170th 16.12.2005

Report on Action Taken by the Department of Women and Child Development on the recommendations/observations contained in One Hundred Sixtieth Report of the Committee on Demands for Grants, 2005-06 (Demand No. 59) of the Department of Women and Child Development (Ministry of Human Resource Development)

7. 171st 16.12.2005

Report on Action Taken by the Department of Elementary Education and Literacy on the recommendations/observations contained in One Hundred Fifty-eighth Report of the Committee on Demands for Grants, 2005-06 (Demand No. 57) of the Department of Elementary Education and Literacy (Ministry of Human Resource Development)

8.10 Minutes of sittings of the Department-related Parliamentary Standing Committee on Human Resource Development relating to various Reports presented to the House were prepared and presented to the House alongwith the relevant Reports. VI. Summary of Recommendations (a) 154th Report 8.11 The Committee was given to understand that out of 509 sanctioned JNVs, 485 JNVs were functional. Out of the remaining 24 non-functional JNVs, 9 have been sanctioned only during the years 2003-04 and 2004-2005 and were likely to start functioning from the next academic year. The Committee was, however, constrained to note that out of the remaining 15 non-functional JNVs, three JNVs, one each in Bihar, Haryana and Himachal Pradesh were sanctioned in 2001-2002, ten JNVs, one each in Gujarat, Haryana, Jharkhand, Rajasthan, Maharashtra, Tripura, UP and Uttaranchal and two in Mizoram were sanctioned in 2002-2003. In all these cases, temporary accommodations have not been made available by the concerned State Governments so far. The Committee failed to understand the reasons behind the inability of the State Governments in fulfilling the minimum requirements for proposals initiated by them. The Committee observed that majority of these districts were located in remote and tribal areas where JNVs were primarily required to be opened. The Committee was particularly disturbed by the situation in Mizoram. The Committee found that out of the six JNVs sanctioned in Mizoram, two JNVs opened – one in 1987-1988 in Lungli District and the other in Chimtupui District in 1992-93 had to be closed down due to less enrolment and administrative reasons. In respect of three JNVs sanctioned in 2002-2003, temporary accommodation was yet to be made available. At present, only one JNV was functional. The remaining two districts of the State were

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yet to be covered. The Committee strongly felt that there was an urgent need for the Department for taking up such cases at the highest level. The Committee felt that given the peculiar geographical location and the overall backwardness of the North-East region, the Central Government should make special efforts on meeting all the requirements to make JNVs functional at the earliest. 8.12 The Committee recommended that concerted efforts should be made to expedite not only the sanctioning of all the 574 JNVs, but also to make them functional in a time bound manner. The Committee would like the Ministry to play the role of a facilitator in clearing the proposals received as well as in encouraging other proposals to be put up for opening new schools in the remaining districts.

8.13 The Committee, however, found that civil construction in the schools was generally running much behind the schedule, because of one reason or the other. Apart from non-availability of funds in time, the Committee found that long procedures and lack of proper coordination between different agencies involved in the exercise were responsible for such delays resulting in time and cost over-run, which must be avoided. The Committee strongly felt that there should be a mechanism at central level working in co-ordination with all concerned state authorities which would constantly monitor all such cases as per time bound action plan. The Committee would also like the Ministry to prepare a consolidated estimate required for construction of pending buildings and plead strongly for that fund with the Ministry of Finance. 8.14 The Committee was informed that 104 JNVs are located in less than 30 acres of land, {with the minimum area of land (9.5 acres) in JNV Bhadoi district, UP } out of which maximum number of 29 JNVs were located in Chandigarh region; as many as 26 JNVs do not have any play field; and most of the JNVs in J&K were not having even a permanent school building. The Committee appreciated the compulsions to relax the condition of 30 acres of land in selective cases where land was scarce. However, the Committee recommended that the relaxation should be granted only after carefully examining the interests of the students and their development. For example, the paucity of land should not be a constraint for games & sports facilities and for this the sports facilities available in nearby schools, institutions, clubs etc, could be shared so that the students were not deprived of their educational and developments needs. The Committee would also emphasise that all efforts should be made to provide required facilities in JNVs which could be made available in less than 30 acres of land area at the earliest.

8.15 The Committee was given to understand that out of 485 functional JNVs as on 31.8.2004, 368 JNVs were functioning in permanent site. The Committee, however, observed that out of these 368 JNVs, 104 were having land area less than the prescribed areas of 30 acres. And out of these JNVs, 11 JNVs were having less than 18 acres, 9 JNVs were having temporary buildings, situation is really bad in J&K as out of 13 JNVs, 4 were running in S.P. sheds and 1 in temporary building. The Committee was not satisfied about the buildings and infrastructure available in the remaining JNVs in the state, as exact details have not been made known to the Committee. Actual status of buildings and infrastructure of JNVs in Chandigarh, Hyderabad and Jaipur Region have also not been made available to the Committee. The Committee apprehended that these JNVs must be in a bad state, totally lacking the minimum requirements. The Committee was also not aware about the status of JNVs having 30 acres of land and functioning from permanent sites. The Committee felt that JNVs functioning from permanent site do not seem to make much difference. The Committee wondered about the factors delaying the provision of required infrastructure once land was made available. The Committee recommended that all JNVs having permanent site should be provided required buildings and infrastructure without any delay. The Committee strongly felt that an effective monitoring mechanism should be evolved for accomplishing this over delayed task. The Department/NVS should work out a time bound action plan in this regard in active coordination with Regional Offices, State authorities and district administration. Funds as and when required should be provided for this purpose but on the condition that all works are implemented at the earliest. 8.16 The Committee further recommended that apart from providing the requisite basic infrastructure, provision for fire safety should also be made on priority basis to make the buildings safer. Regular inspections should be made to see that buildings etc were properly maintained. The school authorities should also discuss the problem of maintenance of building in the Parents Teachers Meetings, so that the local authorities could be pressurized to do the job. 8.17 Some of the state-wise figures were a cause for serious concern. The Committee apprehended that school-wise position would be even more damaging. The Committee failed to understand the factors responsible for overall student intake in JNVs remaining much below the prescribed limit. Either JNVs have failed to attract students or adequate infrastructure for required student capacity is not there. Both the

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situations are very discouraging. The Committee, therefore, recommended that the Department should take steps for conducting a survey for analyzing the reasons for low intake of student in JNVs with particular focus on the JNVs having very low figures and based on the findings of the survey, take remedial action. The Committee felt that except under unavoidable circumstances, the seats must not be allowed to remain vacant. The Committee opined that a merit list of all the students aspiring for the admission might be prepared and the vacancies, if any, might be filled up from amongst the candidates in the list after relaxing the qualifying forms. The candidates belonging to weaker section of the society should be given preference while filling up such vacancies. 8.18 The Committee appreciated the initiatives taken by the Samiti in the field of Computer education. It, however, noticed that a large number of schools were yet to have this facility. The Committee, therefore, recommended that all the JNVs should be covered under this scheme at the earliest. The Committee opined that the maintenance and connectivity with Internet should be ensured to get optimum utilization of computers. The Committee recommended that all the teachers should be encouraged and suitably trained to work on computers. 8.19 The Committee recommended that more Vidyalayas may be covered under the scheme. Local M.P. and MLA could be associated for extending funds to such Vidyalayas for purchasing computers. 8.20 The Committee felt that the Plan outlay of Rs.2, 000 crore supported by grant-in-aid of Rs.383.60 crore under Non-plan would not suffice even for the requirements in respect of the Vidyalayas established till the end of IX Plan, not to speak of any new activity/expansion of JNVs. Therefore, there was an urgent need to enhance the Xth Plan outlay to enable JNVs to meet its commitments without facing any serious financial crisis. The Committee recommended that the case for more funds should be strongly argued with the Planning Commission for this purpose. The Committee hoped that the Planning Commission would also take a positive view. 8.21 The Committee appreciated the adequate representation of SCs, STs and girls in Navodaya Vidyalayas. It still felt that there was scope for further increase in percentages of girls as well as students from rural areas. The Committee, however, expressed its reservation about the eligibility condition requiring a rural candidate to pass class III, IV and V from recognized school/schools, without any repetition of class, gap or break in attendance. The Committee felt that it was not in consonance with the ground realities and hardships faced in rural India. In villages, many times, parents were forced to take their children off the school due to financial or personal reasons, resulting in break in studies. Consequently, many deserving children would stand disqualified for the test. The Committee felt that such restrictions for taking the test do not appear to be justified which might deprive the poor children from getting quality education. The Committee, therefore, recommended that this condition should be reconsidered with a view to enabling those students who are talented, but are unable to afford continuous education. Such students may be given remedial coaching, if need be.

8.22 The Committee recommended that all out efforts should be made to complete the admissions in time so that the studies of children do not suffer.

8.23 The Committee recommended that the procedure as well as machinery for this purpose should be streamlined and sensitized so that they could issue certificates to all the applicants after meticulously checking the details for rural/ urban areas, age etc. The Committee also recommended that the local MLA and President of concerned district Panchayat should also be included in the Vidyalaya Management Committee.

8.24 The Committee was not inclined to accept this reasoning. The Committee was of the opinion that vacancies, if continued for a long time, do result in wastage of scarce resources. It also resulted in denial of opportunity to students who badly need quality education. The Committee, therefore, recommended that efforts were made for filling the seats at first opportunity. Preference to girl students of the area might be given in filling these vacant seats, as their adaptability to any situation was more than the boys. Regional offices of NVS might be empowered to fill up those vacancies under intimation to the headquarters. 8.25 The Committee noted that while the students of Kendriya Vidyalayas in states like Andhra Pradesh and Tamil Nadu have the options to choose between CBSE and State Boards, this facility of dual affiliation was not available in Navodaya Vidyalayas. The Committee also noted the concerns expressed by the Expert Committee nominated by the Government, which have been quoted above. The only concern of the Committee was that selective application of the principle of dual affiliation between KVS and JNVs seemed

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to be controversial. The Committee, therefore, recommended that this issue should be reviewed by the Department at the earliest with a view to have uniform policy in this regard. 8.26 The Committee opined that outside agencies should also be roped in for specialized counseling on the career options available, both inside as well as outside the country. There should also be counseling on various financial options available in the form of study loans/assistanceships provided by the banks and other bodies. The students should also be taken out on study visits to premier institutes of education like IIT, IIMs, and IISc etc. for an exposure to the academic/professional atmosphere so that they also get motivated to set their respective goals and seriously endeavour to achieve such goals. 8.27 The Committee was also of the view that vocational education should be introduced in the JNVs. Besides, Information Technology, Computers, Engineering Drawing courses should also be introduced in NVs with a view to provide more professional and career oriented options to the students.

8.28 Figures relating to Bhopal and Hyderabad region appeared to be disproportionately high. Shillong region being a smaller area and educationally not so developed also showed higher figures. The Committee would also like to point out that percentage of students leaving NVs after Class X in Andhra Pradesh (43.75%) was very high, figures relating to Hyderabad region particularly for 2002-2003 do not seem to be accurate. In contrast, figures in respect of students of Lucknow region showed a declining trend. These figures, the Committee felt, needed a second look. The system for collecting the information regarding placement of its students by the NVS needed to be streamlined. 8.29 The Committee would, however, like to point out that efforts were also required to be made for provision of adequate sports facilities in 117 JNVs functioning at temporary sites and also for all those JNVs having less than 30 acre of area. Students studying at these JNVs should get the same exposure to sports as being provided at JNVs operating from permanent sites/having prescribed area at their disposal. 8.30 The Committee noted that out of 485 JNVs functioning as on 31.8.04, 368 JNVs were functioning in permanent site and 117 JNVs were functioning at temporary sites. The Committee presumed that all 368 JNVs functioning in permanent site must be having hostel facilities. If that be so, the Committee was surprised to note that out of 339 posts of Matron sanctioned as on 30.6.04, only 36 were in place. In Bhopal, Hyderabad, Jaipur, Lucknow and Pune regions, not even one post of Matron have been filled up. The Committee was unable to understand how the hostels can function properly without Matron. 8.31 The Committee was given to understand that teachers were also entrusted with the responsibility of supervising the hostels. The Vidyalayas being residential schools, a great deal of regular support in terms of care, counseling, guidance and emotional attachment was to be developed among the students. The parental care, which was otherwise not available, was to be provided by the teachers. In view of this, the hostel supervision was at time entrusted to the teachers. The Committee was, not inclined to agree with this approach. Engaging teachers for Matron’s job, the Committee was of the view, could be only a stopgap arrangement. Teachers were already over-burdened with their present assignment of teaching. They can, at best, help the matron in smooth running of the hostels. The Committee, therefore, recommended that recruitment for the post of matron should be expedited within a stipulated time frame. 8.32 The Committee emphasized the need for ensuring safety and security of students particularly that of the girls living in the hostels. Security threat differed from region to region, and therefore Principals should be authorised to decide the scale of security arrangements in a particular Vidyalaya. The Committee also emphasised the need for providing proper lighting and fencing around the schools to avoid any untoward incident. 8.33 The Committee was informed that the present strength of regular staff for mess was not sufficient and affairs were managed mostly by persons on daily wages. As per the information made available to the Committee, following was the sanctioned and vacant posts of various functionaries required for providing mess facilities to students:- Post Sanctioned In Position Vacant Catering Assistant 411 368 43 Cook 484 314 175 Store Keeper 360 229 131

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8.34 The Committee observed that in Bhopal, Jaipur, Pune and Shillong Regions, on an average about half the sanctioned posts were filled up. The Committee could understand the problem in getting the services of required personnel for mess facilities in hard stations. However, shortage of such staff in regions like Pune, Bhopal and Jaipur do not seem to be justified. The Committee recommended that NVS should initiate a special drive for filling up all the sanctioned posts for hostels of JNVs at the earliest. If any changes were required to be made in the recruitment procedure, steps might also be taken in this regard. 8.35 The Committee was of the view that the amount of Rs. 555/- per month which came to less than Rs. 20/- per day could not be considered sufficient to provide good and nutritious food to the students. The Committee strongly felt that it should be suitably increased. The Committee also recommended that the services of Food & Nutrition Board should be taken to provide nutritious food to the students required for their proper growth. 8.36 The Committee was of the view that a part time doctor managing around 550-600 students that too in a residential school in rural and remote areas, was not a convincing proposition. Periodical health check-up of students should be carried out and a health card was prepared for every one of them. Efforts should be made for making adequate first-aid facilities in each school to meet the emergency health care requirements of the boarders.

8.37 The Committee understood that quite a few incentives were being given to all categories of employees including teachers opting for “Hard Stations”. However, the Committee was constrained to observe that these initiatives do not seem to be having the desired results as maximum number of vacancies of both PGT and TGT Teachers were in Chandigarh and Shillong Regions whereunder maximum number of hard stations fell. Not only this, maximum number of teachers serving on contract basis were posted in these two Regions only.

8.38 The Committee felt that the vacancies in the teaching staff adversely affected the overall performance of Navodaya Vidyalayas. as the academic activities in schools got seriously hampered. The Committee was of the view that there was an urgent need for reviewing the recruitment procedure of teaching staff. The Committee, also, recommended that the vacancies of teachers in Navodaya Vidyalayas should be anticipated quite in advance and efforts should be made to complete the process of appointments well before the start of next academic session.

8.39 Although the concept of appointing teachers on contract basis was a practical and need-based idea, however, the Committee have reservations about performance and accountability of these teachers. The Committee opined that the performance of teachers appointed on contract basis should be reviewed regularly who might be relieved, if found wanting.

8.40 The Committee noted that 25% vacancies of regional language teachers reflected the extent to which the regional languages were being ignored. The situation was more alarming in the North Eastern Region which needs to be brought more seriously into the mainstream of our educational reforms in an acceptable mode of communication and which was possible only when we nurture the regional languages properly. The Committee thus opined that the posting of language teachers needed to be streamlined to ensure a proper academic atmosphere throughout the year. At the time of appointment of teachers, a clause might be added that rotational transfers are a part of job and no request for stay of transfer would be entertained.

8.41 The Committee recommended that the NVS should ensure a more transparent transfer policy for teachers. The teachers should be posted at hard stations only on rotational basis and should be transferred soon after completing their tenure. The transfers/postings should be effected in the beginning of the academic year and the process of relieving/joining should be streamlined. The Government might also consider extending additional facilities and allowances to motivate more teachers to join and stay back particularly in the areas like North East and Andaman & Nicobar Islands.

8.42 The Committee took note of the reservations of the Ministry of Finance in providing Pensionary benefit to employees of NVS. The Committee failed to comprehend the reasons for having different approach of mind for employees working in two organisations doing similar work under a similar set up and conditions. The Committee would like to point out when employees of Kendriya Vidyalaya Sangathan could enjoy the pensionary benefits on their retirement, what have deterred the Government in providing similar facility for employees of Navodaya Vidyalaya Samiti, many of them away from their families serving in residential schools located in rural areas. The Committee, therefore, strongly felt that the position might be reviewed again and a decision acceptable to employees of JNVs might be reached at the earliest.

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8.43 Training was an integral part of any organization. Training gave a chance of interacting with fellows of same profession and gave them exposure to learn many new things. 8.44 The Committee noted that the training aspect for NVS staff left much to be desired. There was not even sufficient number of trainers in training centres. The Committee felt that training aspect was being neglected badly. Even the post of Directors, in the training institutes, was not approved and the Regional officers were entrusted with the job to look after the training institutes. The Committee recommended that the Ministry should make urgent efforts for strengthening and streamlining the process of training for the teachers by providing necessary infrastructure and manpower. 8.45 The Committee noted that utility of six training centres established in 2001-2002 was analysed by the Samiti in 2002-2003 and Mangalore Training Centre was closed. The Committee found that these training centres were not evenly spread covering all parts of the country. While two of the centres were located in Andhra Pradesh, no training centre have been set up in the North-eastern region. Northern region also do not seem to be adequately covered. The Committee felt that these centres could have been easily set up in the eight Regional Offices of NVS. The Committee, therefore, recommended that feasibility of this option might be explored. If not found possible, steps might be taken for setting up a centre in N-E region. 8.46 The Committee noted that despite so many surprise visits, there was no indication of any increase in the overall efficiency in these schools. It was equally disturbing that no details about the outcome of these inspections was provided to the Committee. The Committee also noted the difference in pattern of such visits as, schools in Jammu & Kashmir have been visited only once, whereas Manipur had been inspected eight times.

8.47 The Committee recommended that there should be periodic inspection depending on the number of schools in these areas and staff available for inspection. The guidelines for inspection should be circulated to all regional offices. Action taken on these reports should also be checked periodically and as far as possible the local M.Ps might also be invited during the inspections to have the benefit of their experiences. 8.48 The Committee was of the view that because of JNVs being residential schools spread over different parts of the country, monitoring mechanism through regular and surprise inspections followed by corrective action was essential for their smooth and effective functioning. The Committee, however, felt that with the present set up in the Regional Offices, inspections were not being carried out in the real sense. The Committee, therefore, recommended that the Department/NVS should take steps for augmenting the required staff at all the Regional Offices. The Committee would like to be apprised about the details of follow-up action taken on the 95 surprise inspections carried out during 2003-2004. 8.49 The Committee noted with concern that the Regional Offices were functioning in rented buildings. The Committee recommended that concerted efforts with the concerned State Governments should be made to get suitable land so that Regional Offices could be shifted to their own permanent buildings. The Committee would like the Department to accord due importance to the Regional Offices, which were instrumental in managing the affairs of the JNVs in that particular region more effectively and efficiently. The Ministry of HRD should take the lead and pursue the State Government, if possible at the Minister’s level.

8.50 The Committee noted that in spite of expansion of JNVs from 2 Vidyalayas started in 1985-86 to 509 at present, the staff strength at Regional Offices have not increased proportionately. These eight Regional Offices with the meagre sanctioned staff strength, functional strength might be even less, were supposed to supervise the functioning of 509 sanctioned NVs (485 NVs being functional), many of them located in remote and inaccessible areas. The Committee could well imagine the state of affairs. The Committee, therefore, recommended to have an O&M study done urgently for the evaluation of the work & staff in ROs, so that the requisite number of posts could be created for smooth functioning of NVs. 8.51 The Committee was not satisfied with the functioning of the grievance redressal mechanism in NVs and felt that if teachers grievances were not attended to in time, they would not be able to concentrate on teaching. The Committee recommended that all the Regional Offices should have a Grievance Cell so that the cases were attended to and disposed off quickly. The principals should also endeavour to get the matter sorted out early in consultation with the Regional Offices. The aggrieved person should also have easy access to the officers. For this, a day in a week might be fixed enabling them to meet the officials. The Teacher's Association should also be encouraged to participate in the decision making process of the Samiti.

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8.52 The Committee was not convinced by the arguments of the State Government mainly because the JNVs were catering to the educational needs of meritorious students from the poor and deprived sections of the society, with special emphasis on the girl students. The three language formula adopted by the JNVs needed to be encouraged by all the State Government as an element of national integration. The Government should, therefore convince and persuade the State Government on these broad objectives to adopt the schemes of JNVs. 8.53 The Committee felt that most of these problems could be solved with proper coordination and support from the State Governments. Since the Navodaya Vidyalayas do not have financial provision for laying connecting roads, electrical lines, and levelling the lines, etc., the State Govt. should be requested to periodically monitor the support given to the Vidyalayas and ensure that the minimum infrastructural facilities are extended uninterruptedly. District Magistrate being actually associated in all such issues could take lead in getting these problems redressed quickly. 8.54 The Committee felt that there was an urgent need for conducting a survey of all the JNVs so as to assess the shortfall in required infrastructure, condition of school/hostel buildings, availability/non-availability of proper hostel facilities in all respects. Such a survey should also cover the student intake capacity and present student strength alongwith the required and present strength of teachers/non-teachers (Vidyalaya-wise), need for relocating some Vidyalayas in view of optimum utilisation not being there. The Committee would emphasize that status of Vidyalayas operating from both permanent and temporary site should be reflected separately. Only then the factual position would emerge. Findings of such a survey and also Committee's recommendations/observations on various aspects of functioning of JNVs should lead to corrective action by JNVs/Department.

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8.55 The Committee appreciated that the Department have got the figures cross-checked and have come out with the revised figures. However, this instance indicated an attempt in some States to portray unrealistic data. The Committee was, therefore, of the opinion that the Department should put in place its own mechanism to cross– check the data given by the States as also to oversee the progress being made under the Sarva Shiksha Abhiyan.

8.56 The Committee after perusing the summary of quarterly reports received from independent monitoring institutions during 2003-2004, found that the reports have basically confirmed the fears of the Committee. The Committee noted the contradictions in the reports of the progress made under Sarva Shiksha Abhiyan after a comparison between the official monitoring channels and the independent external audit organizations. While the official version indicated a tremendous improvement under Sarva Shiksha Abhiyan, the independent agencies pointed out that there was still a significant difficulty in mainstreaming of children belonging to minority communities, children living in urban slums, girls and children of SC/ST and other backward communities. Assessment of quality of teaching-learning process was a cause for special concern for the Committee. Lack of teachers, teacher absenteeism, teacher training, need for strengthening DIETS were some of the problem areas cited. The handicaps suffered by the EGS Centres, the unaccomplishment of a completely cooked mid day meal, poor progress of construction works which was further marked by use of low quality material, under-utilization of funds, lack of facilities were the factors that have adversely affected the imparting of quality education. Besides, delay in release of matching funds by the State Governments coupled with the delay in flow of funds from state to district level and below have also hindered the achievement of elementary education. 8.57 The Committee noted that the shortcomings/hindrances in elementary education as pointed out in quarterly reports of the independent agencies were not new ones. In fact, the Committee have time and again commented on all these aspects but unfortunately the Committee was constrained to observe that the Department was yet to initiate implementation of required corrective measures. The Committee would again caution the Department for such lacunae and recommend that concrete efforts was made to remove the bottlenecks in case the goals of universal elementary education were to be achieved in time. Time has come to really act on field in active co-ordination with the implementing agencies, lest the flagship SSA scheme would remain on paper only.

8.58 The Committee was not impressed about the increase in the completion rate of new school buildings from 8.7 to 12.5 % as claimed by the Department. The Committee felt that this dismal rate of progress in the

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construction of school buildings amply indicated the low level of coordination between Central and State Government, and State Governments and implementing agencies. The Committee was surprised to note that no information on the status of additional classrooms to be constructed have been given by the Department. The Committee emphasized that the Department took all necessary steps to expedite the construction so that the noble purpose envisaged in the SSA was not defeated.

8.59 The Committee was aware of the fact that the States were required to adopt child centered activity-based pedagogy in classroom transaction. The concerns of the Committee reflected in its recommendation have not been replied to by the Department. The Department should have supplied more information on this front. The Committee would like the Department to give a clear picture, state-wise, and would also like it to take-up the matter with those States who have not adopted activity-based pedagogy at elementary level.

8.60 The Committee noted that funds have been released to the concerned State societies of 2656 selected blocks for the new Programme for Education of Girls at Elementary Level (NPEGEL). The Committee would, however emphasise that the monitoring of this programme at the ground level should also be initiated from the very beginning.

8.61 The Committee would like to know the reasons as to why five states were still not serving cooked meal under MDM Scheme. The Committee felt that the Department should seriously pursue with these states and find out ways and means to enable these states to switch over to the basic feature of Mid Day Meal Scheme.

8.62 The Committee found it ludicrous that the Department have failed to ensure a matching financial grant against the utilization of allotted food grains. This imbalance have affected the lifting of the food grains, which ultimately must have had its negative impact on the successful running of the scheme. The Committee felt that the Department should persuade the Planning Commission to give sufficient funds so that the scheme does not suffer.

8.63 Guidelines referred to in replies to para nos 5.8 and 5.9 should have been appended to ATR as annexeures for the ready reference by the Committee.

8.64 The Committee have been reiterating time and again that in cases where viable proposals were not forthcoming from the States’ etc as in the case of opening DIET/CTE/IASEs, Department have to play a more pro-active role by finding out the reasons as well as facilitating the States and other agencies to come forward because the basic accountability for slow/non implementation of schemes lies with the Centre only.

8.65 In the case of operationalisation of DIETS by the States/UTs also, the Committee, wanted to reiterate its view of the need for the Department playing a positively proactive role in persuading the States and facilitating them in expanding the framing network for the teachers as soon as possible. 8.66 The Committee found it astonishing that basic amenities do not get any priority in the programme. In fact, no provision for the basic amenities actually reflected no concern for the students as well as teachers. It was also inhuman. The Committee strongly felt that provision of basic amenities such as toilets and drinking water do get equal priority alongwith school buildings and additional classrooms. The Committee understood that the schemes for providing drinking water and toilet facilities in schools were also being administered by the Ministry of Rural Development. There might be other Departments both at Central and State level, which might be directly or indirectly involved in provision of basic facilities at schools. The Committee would appreciate if a joint-mechanism involving various sanctioning/implementing authorities was evolved to have better results.

8.67 The Committee disapproved such a cryptic reply by the Department. The Committee felt that the Department’s reply should have been updated with the response of the State Government. The Committee hoped that the Department would actively pursue with the State Government and furnish the actions taken by the State Government in this regard.

8.68 The Committee appreciated the improvement made in the utilization of funds during the first two years of the Tenth Plan. The Committee felt that though there were no fixed quantitative targets to be achieved, yet,

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the quantum of beneficiaries should have been more than what it was today. It hoped that the Department would take necessary measures to cover more people within the ambit of Jan Shikshan Sansthan.

8.69 The Committee found the reply of the Department too routine & technical. It also knew these stipulations/procedure in selecting the NGOs but the question was then why so many cases of defaulting NGOs were being reported every year. It only showed that present procedure was not fool proof and needed to be revisited with a view to making it more transparent and effective. (c) 156th Report

8.70 The reasons advanced by the Department for continuous underutilization of allocated funds for various welfare schemes confirmed Committee’s apprehensions about major drawbacks in the formulation and implementation thereof. While unsatisfactory performance of implementing agencies, i.e. NGOs have been cited as the factor responsible in the case of scheme of Short Stay Homes, it was the inherent shortcomings noticed in the salient features of the scheme of “Condensed Courses on Education for Women.” The Committee was surprised to observe that it had taken years to make the Department realize that programmes like “Balika Samriddhi Yojana” and “Indira Mahila Yojana”, needed to be revitalized/expanded. However, this did not discourage the Department from continuing to make allocations for these Programmes. Such a situation confirmed Committee’s doubts that programmes continued to be announced without any assessment preceding the same. 8.71 The Committee expressed its unhappiness over the inefficiency and lack of direction and to some extent lack of leadership at the Central and State level which have culminated in the poor and dismal utilization of budget allocation for many socio-economic programmes. These Programmes, if implemented in right earnest, would have benefited thousands of needy and distressed children and women. The reply of the Department appeared to be shifting the responsibility to other agencies for various reasons. The lackadaisical approach of CSWB, which was directly under its control, have miserably failed in achieving its targets. The Committee desired that the Department should take up with various agencies/State Governments/UTs for effective implementation of these schemes and also for removing the lacunae of the schemes.

8.72 Committee’s attention have been constantly drawn towards the perennial problem of non-submission of utilization certificates by the implementing agencies. The Committee observed that there have not been any significant improvement during 2004-05 also. The Department’s admission that against an allocation of Rs. 20 crores for ‘Swayamsidha’ during 2004-05, only Rs. 2 crores could be released, reason being huge unspent balances of Rs. 14 crores lying with the States supported Committee's assessment. The Committee hoped that commissioning of mid term review of the Schemes to identify bottlenecks and suggest strategies/corrective measures might perhaps yield some positive results.

8.73 The Committee observed that performance of ‘Swadhar’ scheme continued to be discouraging during 2004-05 also. The Committee found that against a BE allocation of Rs. 13.50 crores for the scheme in 2003-04, only Rs. 3 crores have been provided in 2004-05. The Committee noted that as reported by the Department special efforts like advertisements in newspapers, workshops with NGOs etc. had to be made for optimum utilization of allocated funds during 2004-05. The Committee hoped that concerted efforts made by the Department would lead to opening of more Swadhar homes and better functioning of the existing ones.

8.74 The Committee noted with concern that even after the directions of Supreme Court, the Department have shortfall of operationalsing 381 ICDS projects. The Project of ICDS was started long back in 1975 and the Department was still considering options for strengthening supervision and monitoring at various levels, even after nearly three decades. This does not augur well for such an important scheme. The Committee hoped that intensive monitoring of the scheme would not only increase the achievement level of the existing AWCs but would also indirectly affect the opening of remaining AWCs. The Committee would, however, like to emphasize that functioning of NGOs inspite of being reputed ones and recommended by the Planning Commission needs to be monitored on a regular basis. 8.75 The Committee noted that the Central Government have been supplementing the efforts of States in providing supplementary Nutrition by providing food grains at BPL rates. Besides that PMGY also took care of nutrition requirement of children of 0-3 yrs. A pilot project have also been launched in 51 nutritionally backward districts. The Committee found it surprising that inspite of so many schemes; ground realities continued to highlight an entirely different scenario. The Committee strongly felt that something somewhere

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is wrong. The Committee, therefore, recommended that the Department should without any further delay initiate required action so that benefits of all such schemes reached the beneficiaries. 8.76 The Committee found the reply of the Department to be too technical and hence evasive. The Committee's intention was to evolve a more rationale approach in the norm of setting up Anganwadi Centres in case of Manipur and other States having similar geographic location so that more Anganwadi Centres could be set up in these areas. The Committee, therefore, reiterated its recommendation.

8.77 The Committee was aware that the problem of malnutrition was so huge and complex that inter-sectoral efforts in the areas of food security, health and education are necessary. The Committee reiterated that different schemes of child nutrition being implemented by various Ministries/Departments and also at State level need to be brought under one nodal agency with special focus on tribal and remote areas of the country. Interdepartmental meetings for setting nutrition goals and framing the strategy for achieving the same do not seem to have led to any visible improvement. The Committee, therefore, reiterated that the Department mandated to look after the welfare of children and women have to play a more pro-active role. 8.78 The Committee noted that there have been some improvement in the training of different categories of ICDS functionaries. However, figures as on June, 2004 indicated that considerable gap still remained to be fulfilled. The Committee hoped that all ICDS functionaries would be trained by 30.06.05 under the extended ICDS-III Project as indicated by the Department. The Committee, however, reiterated that the Department should formulate an alternative programme of training which could be initiated immediately after the completion of ICDS III project on 30.6.05. 8.79 The Committee noted that the recommendations of the national level Conference on Crèche Programme held in July, 2004 remain largely unattended even after more than four years. The Committee deprecated the casual approach of the Department in implementing these recommendations. Department’s reply clearly indicated that no final decision is likely to be taken in the near future. The Department do not say anything about the reasons for non-functioning of 28 crèches. The Committee recommended that a time-bound action-plan should be made and implemented with regular supervision at various levels to achieve the desired objectives. 8.80 The Committee observed that after a prolonged phase of indecision about the fate of Balika Samriddhi Yojana, a decision have been taken not to transfer the scheme to the States and it shall be operated by the Central Govt as being done earlier. The Committee would like to emphasize that the scheme was not running well under the administrative control of Centre. There were huge unspent balances lying with the State Govts. The Committee apprehended that pendency level continued to remain the same. The Committee was not satisfied with the stand taken by the Department that only States submitting satisfactory utilization would be sanctioned funds. The Committee strongly felt that there was an urgent need for evolving an effective monitoring mechanism to ensure that financial assistance as envisaged under the scheme reached all the targeted beneficiaries.

8.81 If the Committee was to accept the explanation given by the Department of Women and Child Development, then there must be some problem with target fixing. Did it mean that lower targets were fixed deliberately to avoid large gaps in achievements at the end of the year? The Committee felt that a more realistic approach needs to be taken by the Department of Women and Child Development. 8.82 The Committee was not aware whether there existed any mechanism to get the feedback on the complaint sent to the Department of Women and Child Development of State Governments/State Women Commission. The Committee recommended that the feedback should be obtained on quarterly basis. The Committee also recommended that those complaints which do not come under the mandate of the Commission might be treated as disposed off and should not be shown as pending complaints. 8.83 The Committee was of the view that, Department of Women and Child Development have to play a proactive role for this purpose by working as facilitator for setting up the State Women Commission in the remaining States. Mere writing letters or taking meetings have not worked so far.

8.84 The Committee noted that a provision of Rs. 3.00 crore was made in 2004-05 for a new scheme, ‘Rescue of victims of Trafficking’ proposed to be launched. The Committee found that the scheme remained at the proposal stage as it was yet to be finalized. The Committee reiterated its earlier recommendation that all

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preparatory exercise for a new scheme should be completed well in advance so that funds earmarked for the same could be utilised. 8.85 The Committee was not convinced with the reasons for delay in introduction of the Bill in Lok Sabha. The Bill was pending for a long time. The Committee desired that a time-frame should be fixed for re-introduction of the Bill. 8.86 The Committee recommended that efforts should be made for the formation of National Children’s Board immediately. 8.87 The Committee noted that a review of two schemes ‘STEP’ and ‘Swawlamban’ was to be taken by the Department with regard to overlapping of their objectives. The Committee felt that this process should be expedited and final view on the merger of these two schemes might be taken at the earliest.

8.88 The Committee felt that there must be at least one representative from the Centre also in the SLECs in the States. Idea of involving eminent social workers of the area could also be considered.

8.89 Involving University Women Departments in monitoring the NGOs needed to be strengthened further. It could work wonders. Despite existing penal provisions for erring NGOs, not many of them were being penalized, the Committee felt. 8.90 Committee had expressed its concern about there being no criteria for having a specific number of NGOs in a particular area. The Committee had, accordingly, recommended that there should be specific guidelines whereunder number of NGOs in a district (subject to area) should be indicated. The Committee felt that mere noting of Committee’s recommendations for compliance would not serve the purpose. The Committee reiterated that there was an urgent need for having such guidelines otherwise instances of excess number of NGOs operating from a limited area would continue to occur.

8.91 The Committee was dismayed to note that the Department have failed to share its apprehension for strengthening the monitoring mechanism by making sanctioning/approving authority accountable for the non-performing/under performing NGOs. It seemed the Department have confined its responsibility only to sanctioning the loans.

(d) 157th Report 8.92 The Committee appreciated the Ministry’s move of issuing instructions to various implementing agencies to maintain gender disaggregated data for effective monitoring of the gender based analysis of various youth as well as sports schemes of the Ministry. However, the Committee felt that Ministry's gesture in this direction should move further. An exclusive Cell in the Ministry might act as a watchdog to oversee the progress made by the implementing agencies with regard to funds being spent on the women component under various schemes. The Committee hoped that the budgetary documents of the Ministry would reflect the gender component of allocations under different schemes. 8.93 The Ministry have not shared the details of initiatives taken by them to empower the youth through its various schemes. Even the details of the proposals identified by the Ministry for convergence of service and utilising youth clubs for community development have not been mentioned. Only specific action taken by the Ministry was the setting up of a national inter-ministerial Committee under the Chairmanship of Secretary (Youth Affairs & Sports) for preparation of draft National Plan of Action. The Committee was not aware about assessment if any, of youth scheme(s) initiated by this Committee so far. The Committee would like to be apprised in this regard. The Committee emphasised upon the Ministry to ensure that the task assigned to the Inter Ministerial Committee was executed within a stipulated time frame in order to have the desired impact on various youth scheme.

8.94 The Committee expressed its unhappiness that a large number of posts of District Youth Coordinators were lying vacant continuously for more than 8 years. Some posts were advertised in December 1996, interviews were also held in November 1997 but the results were not declared and the entire recruitment exercise was cancelled on the ground that the posts created by the Governing Body of Nehru Yuva Kendras (NYKs) do not have the mandatory approval of the Ministry of Finance. The Committee was not ready to accept such reasoning given by the Ministry of Youth Affairs and Sports. How could the Ministry afford to remain all along ignorant of the functioning of Governing Body of NYKs which was headed by the Minister

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of State of the Ministry? Somewhere some accountability needs to be accepted. The Committee felt that the Ministry have failed to handle the issue. Here the Committee would like to reiterate that the Ministry would be failing in achieving the targets with such a less number of District Coordinators. The Committee would like the Ministry to seriously pursue its case for sanction of posts of District Coordinators and also lifting ban on their recruitment with the Ministry of Finance. The Committee felt that the makeshift arrangements as done in some of districts by giving additional charge to the Regional Coordinators would not work for a long period. The Committee opined that Ministry should seriously endeavour for effective implementation and universalisation of NYKs schemes by appointing its functionaries in all districts across the country. 8.95 The Committee’s attention have been drawn towards the prolonged process in taking a decision about the continuance of the scheme of National Reconstruction Corps. The Committee have been commenting on the under-utilisation of funds allocated for the scheme for want of a decision. The Committee was, however, distressed to note that almost two years have elapsed since the completion of the Pilot Project on 31st March, 2003 and the revised scheme was awaiting approval from the Ministry of Finance and Planning Commission. The Committee observed that Rs.10.80 crores earmarked for the scheme for 2004-05 would again remain under- utilised. The Committee urged upon the Department to expedite all the required formalities so that from 2005-06, the scheme is implemented in the true sense. 8.96 The Committee in its last Report had specifically asked for details about assessment of the work done by NGOs under the National Integration Camp and Inter-state Youth Exchange programmes specially those getting the maximum grants. The Committee was surprised to note that instead of furnishing the information asked for, the Ministry have specified the process of selecting NGOs for grants. The Committee presumes that perhaps no assessment have been done so far. If that be so, the Committee took a serious view thereof. 8.97 The Committee have time and again been expressing its concern over the performance of the scheme of Youth Hostels. The Committee was aware that construction of youth hostels was a joint venture of Central and State Governments but the plea of the Ministry that the performance of scheme to a large extent depended on the initiative of the State Governments was not acceptable. The Committee was constrained to note that there seemed to exist no system of monitoring the progress made in the construction of youth hostels. The information being given by the Ministry in December/January, 2005 that 20 youth hostels were under construction upto December, 2003 confirmed Committee’s apprehensions. The Committee have not much hope about the fate of 20 youth hostels for which the Ministry have already conveyed its approval, as a number of procedural requirements as listed by the Ministry were yet to be completed. The Committee was of the view that the Ministry have to take a more pro-active role by pursuing this matter with the concerned State Governments. 8.98 The Committee noted that the National Commission for Youth set up in March, 2002 for a period of six months to study the problem of youth and suggested remedies have finally given its Report in September, 2004. The Committee have been informed that recommendations of the Commission were under the consideration of the Ministry. The Committee hoped that undue delay in submission of the Report of the Commission would not occur in the process of implementation of its recommendations. 8.99 The Committee noted that the Scheme for Welfare and Development of Adolescents targeted to be implemented in Tenth Plan could be initiated in 2004-2005, i.e. third year of the Tenth Plan. However, the fate of the other new scheme ‘Scheme for Establishment of National/State Youth Centres’ proposed to be initiated during Tenth Plan was still undecided. The Committee reiterated its recommendation that allocations of a particular new scheme should be made only on completion of all procedural formalities. 8.100 The Committee observed that some progress was made during 2004-05 to make the Rajiv Gandhi National Institute for Youth Development functional. Proposal for creation of four divisions with 12 posts have been approved by the Ministry of Finance and these posts are likely to be filled up during the current financial year itself. The Committee hoped that all construction related problems would also be sorted out with the appointment of Arbitrator. The Committee would, however, like to emphasise that efforts should be made to get all the construction work completed within a fixed time-schedule, to avoid any increase in the project estimates. 8.101 The Committee was at a loss to understand that despite a huge network of mechanism of feedback from the field functionaries, the instances of non-submission of UCs by a large number of NGOs have not declined. It seemed that monitoring reports to be submitted by field representatives of NYKS and NSS were not reaching the inspecting authorities. The Committee felt that this directive was being impressed upon only

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after Committee’s observations in this matter. The Committee was of the view that in the event of non-performance/non-compliance of prescribed norms by any NGO; the matter should be taken up with the recommending authorities also. The Committee also felt that there was a need for taking deterrent action against non-performing NGOs to ensure better performance from other NGOs in the field. Mere blacklisting them would not serve any propose. 8.102 Committee’s attentions have been drawn towards under-utilisation of allocated funds to Sports Authority of India during 2003-04. The Committee was not convinced by the justification given by the Ministry in the matter. It have been informed that due to unspent balances of Rs.35.00 crore available with SAI from the previous year, budget allocation of Rs. 110.50 crore for 2003-04 was reduced to Rs. 97.00 crore and the actual expenditure was Rs.115.82 crore. This clearly indicated that unspent balances were still available with SAI. The Committee expressed its serious concern over this state of affairs. The Committee apprehended that level of expenditure would continue to be the same in 2004-05 also. The Committee was, therefore, of the view that the Ministry should initiate stringent measures for streamlining the entire system. 8.103 The Committee have been given to understand that selection of States for locating Regional Centres/Sub-centres have been decided based on the geographical size and population in each zone. If that be so, the Committee failed to understand the reason for shifting Northern Regional Centre from Chandigarh to Sonepat. Lack of insufficient sports infrastructure at Chandigarh have been cited the reason behind such a decision. The Committee expressed its reservation in this regard. The Committee felt that required land and funds being made available by a State was the real criteria. The Committee was perturbed to note that the four new sub-centres at Nagercoil (TN), Lucknow (UP), Hazaribagh (Jharkhand) and Jabalpur (MP) were yet to be opened. The Committee recommended that these centres should be opened and made functional at the earliest. 8.104 The Committee took a serious note of the explanation given by the Ministry regarding instances of our sportspersons being tested positive for banned drugs. The Committee was distressed that while cases of doping were increasing, the Ministry and its concerned agencies instead of owning the responsibilities, still continue to disown their responsibility. The Committee termed the situation very deplorable as ultimately the individual sports-person was held responsible for having been tested positive in doping at international events. The Committee felt that if the Ministry was really serious to combat the malaise of doping it should not even hesitate to de-recognise those Sports Federations who were not getting the dope-testing of the athletes conducted as and when required. 8.105 The Committee felt that despite all claims of the Ministry about the documentation of samples in DCC, SAI labs, it remained a matter of examination for all sports administrations including the Ministry as to whether the procedure as well as the facilities for testing the samples actually met the international standards as approved by WADA. The increasing cases of doping by our sports persons put a question-mark on such procedures and documentations. It was understood that the issue of permanent accreditation of DCC, SAI is under consideration of WADA. The Committee felt that this is the right time to get our facilities accredited for international level of testing. The issue of permanent accreditation assumed great significance. The doping issue was to be seriously debated in the context of coaches particularly the foreign coaches who have been pin pointed for their connivance with the doping testing authorities at international level. The Committee would, therefore, reiterate that the coaches as well as doctors of sportspersons, who were incharge of their training, need to be made equally accountable. The Committee would also impress upon the Government to depute more sport scientists at DCC, SAI.

8.106 The Committee found it quite disturbing that no concrete efforts have been made to streamline selection criteria of sports persons at the international level. The fact that we could win only one Bronze medal in 1996, one Bronze medal in 2000 and a silver medal in recent Olympic games indicate the level of sports and the selection of sports persons in our country. In a country of more than 1000 million people, the performance of our sportsmen continued to be very discouraging at the international level. The Committee, therefore, emphasised upon streamlining the entire selection criteria of our sports persons to get better results in future. For that matter, the participant sportspersons for the next Asian Games, Olympics and even Commonwealth games in 2010 should be selected without further delay. 8.107 The Committee appreciated the initiative for adoption of 27 schools for promotion of indigenous games/martial art and Navodaya Vidayalas for providing opportunity to the aspiring rural children to undergo sports training. The Committee, however, failed to understand the linkages of the new initiatives taken through Sports Authority of India with the scientific training modules. Even crucial issues like sports

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medicine and sports psychology have also been not addressed in the reply. The Committee would like to be apprised about the training modules framed to achieve best results at international level. There should not be any difficulty in exploring the training modules being implemented in other neighbouring countries like China, Japan, Korea etc. 8.108 The Committee welcomed the initiative taken by the Ministry to bring to the notice of the VCs of various recognized Central Universities the existence of the scheme of grant to colleges/Universities. However, the Committee would like the Ministry to pursue the matter constantly with the State Governments to take benefit from the scheme. 8.109 It was surprising to note that 31 out of 44 projects approved since 1998-1999 have not been completed as some of the State Governments/ Grantees could not submit the UCs, progress reports etc. The Committee hoped that the revised rates of central assistance would lessen the financial burden of State Govts and ease the problem to some extent. The Committee while reiterating its earlier recommendation would like the Ministry to expedite finalisation of projects which otherwise may keep on piling ultimately affecting the performance of our sportspersons. The Committee appreciated the proposed upward revision of funds under the revised Sports Infrastructure Scheme. 8.110 The Committee felt that non-utilization of funds by States was not a recent development. Instead the Committee have been pointing out problems time and again but no concrete efforts seem to be done by the Ministry as the situation have not improved. The Committee would like to be apprised about the outcome of the Conference of State Sports Ministers and the follow up action taken by the Ministry with regard thereto. 8.111 The Committee was not satisfied with the state of affairs prevailing in the sports federations. The Committee felt that the efforts made by the Ministry with regard to ensuring the financial accountability have not yielded any results. The Committee emphasised that these sports federations, registered under the Societies Act, were duty bound to file their accounts. The money they spend is the public money, and therefore, it was obligatory on their part to publish these accounts. They should therefore, not only file their annual accounts but also reflect the funds released to them by Central Government as well as money received from other sources. Errant federations should be de-recognised. (e) 158th Report

8.112 The Committee was happy to learn that about 98 percent of this fund had been utilized till 30 March, 2005 under 'Elementary Education'. Under the head 'Adult Education' the performance of the Department was not equally impressive as only 77.95% of allocated funds were utilized till 18.3.05. The Committee was, however, surprised to note that utilisation under Adult Education jumped to 92 per cent in a span of just 13 days, i.e., between 18 and 30 March, 2005. 8.113 The Committee is happy to note that elementary education had been accorded high priority, which was reflected in its allocations for the year 2005-06. The Committee was of the opinion that since the Department have been given adequate funds specially from the 'Education Cess' collected from the tax-payers of the nation, it was the responsibility of the Department to ensure that the programmes/schemes, especially the SSA and MDM, were implemented in the right earnest, with utmost sincerity and above all with a missionary zeal. The Committee called upon the Department to take every possible step for the optimum and judicious utilisation of the enhanced allocation in 2005-06. 8.114 The Committee did not find the clarification given by the Department convincing. Position was the same during 2002-03 also. As per the information available with the Committee, expenditure details included not only unspent balance but State share also.

8.115 With the enhancement in allocation, expenditure was also increasing. However, in the absence of information about actual utilisation figures, assessment about achievement level, both in the terms of physical and financial targets, could not be made. It was also not clear whether the States were contributing their due under SSA. Availability of unspent balance with the States could be justified for one year. However, its continuance could only create doubts about the ability of the States to utilize the allocated funds. The Committee observed that there was another aspect of this situation. Under the present funding pattern, States were supposed to contribute 25% of central release. With the increase in Central funding, State share also became higher. It was not known whether the States were in a position to bear the additional burden, which would increase further after Tenth Plan. The Committee, therefore, was of the opinion that for real evaluation

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of all Schemes including SSA, it is very essential to have separate details about state share, utilisation and unspent balances. The Committee would like to be apprised about the utilisation of funds during the first three years of Tenth Plan. 8.116 The Committee felt that SSA being an essential programme should run smoothly. The Government should ensure that the release of money to the States was not withheld for a long time. The Department must find some way out for this. The Committee have been given to understand that a proposal for change in the sharing arrangement between the Centre and the States have been sent to the Planning Commission for consideration. The Committee felt that this issue should be resolved at the earliest for better implementation of the programme. 8.117 The Committee was concerned about the status of SSA in Goa. Goa was at present outside the ambit of SSA. The Committee felt that Goa being presently under President's Rule, Central Government could play a pro-active role in the implementation of SSA in the State. 8.118 The Committee, therefore, felt that there was an urgent need for ascertaining the problems/constraints being faced by them so that removal thereof enables them to take benefit of SSA. 8.119 But the Committee felt that the physical performance in the past under various components of the scheme inspires little confidence. 8.120 The Committee was informed that another hurdle in recruiting teachers was that 'para-teachers' have gone to the Court. The Committee was of the opinion that instead of waiting for usual course of verdict by the Courts, Department should adopt a pro-active attitude and impress upon the Courts about the urgency and significance of the SSA. 8.121 The Committee felt that things would not have improved since then. The Committee wondered whether there existed any provision for utilization of SSA funds for strengthening of existing school buildings. If not, feasibility of utilisation of SSA funds for this purpose could be explored. Participation of community should also be encouraged in providing various facilities such as more class room, toilets, drinking water etc. in the schools. 8.122 Similarly, the achievement with regard to construction of toilets and providing drinking water facilities was as low as 30.13% and 50.43% respectively as against their targets. 8.123 The Committee was informed that targets for the 2005-06 were expected to be finalized during the first quarter of the 2005-06 only as the appraisals of district-wise annual work plans were yet to be received from the State/UTs. The Committee was at a loss to see that despite quantum jump in the allocation of funds and good utilization shown thereof, targets fixed were not being achieved. So much so, no targets could be fixed for the year 2005-06 till now and the same were not expected before the end of first quarter of 2005. It was strange that the financial year have begun and we were yet to have the targets fixed. The Committee did not appreciate the idea of implementing such an important scheme without fixing the targets and a time-schedule. The Committee was of the view that the scheme should be implemented with the seriousness that it deserves. 8.124 The scheme, even after four years of its implementation have not made any visible impact on the ground. Data from NIEPA have shown that most of the facilities claimed to being provided under the SSA were non-existent in the schools in rural areas. Lack of toilets and drinking water was common problem in the schools. As per 2003-04 figures, drinking water was not available in 49% schools in Andhra and 33% in Karnataka. In Bihar and Jharkhand nearly 20% children did not enjoy the facility of a blackboard. About 62% primary schools in Assam, 34% in Andhra, 30% in Meghalaya had only one classroom. These figures are; of course, for the year 2003-04, but the Committee felt that nothing revolutionary might have happened since then to dramatically alter this situation.

8.125 The Committee was of the view that data brought out in the Report weaknesses in the implementation of SSA. Based on the findings, State specific weak areas could be identified and corrective measures could be easily initiated. Only effort required would be constant monitoring by Centre/State in active co-ordination with implementing agencies and local community. The Committee would like to know the follow up action taken, if any, in this regard.

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8.126 Further, a cursory look at the summary of quarterly reports received from independent monitoring institutions during 2003-04 supplied to the Committee basically confirmed the fears of the Committee. The Committee noted contradictions in the reports of progress made under SSA after a comparison between the official monitoring channels and the independent external audit organizations. While the official version indicated tremendous improvement, the independent agencies pointed out that there was still a significant difficulty in mainstreaming of children of minority communities, SC/ST and other backward communities and those living in urban slums. Assessment of quality of teaching-learning process was a cause for special concern for the Committee. Teacher absenteeism, lack of teachers and teacher training, need for strengthening DIETs are some of the problem areas cited. The handicaps suffered by the EGS Centres, poor progress of construction works, which is further marked by use of low quality material, lack of suitable school building and other facilities, electricity, boundary wall and furniture were the factors that have adversely affected the implementation of the SSA. Besides delay in release of matching share by State Governments, delay in flow of funds from State to district level and below pointed out in these reports have serious implications for the success of SSA. 8.127 The Committee was informed that as in August 2004, completion rate of new School buildings improved from 8.7% to 12.5%, while another 36% were under construction. Progress was being regularly monitored and pursued with State Governments. The Committee was not impressed with the pace of completion of new school buildings i.e. 8.7 to 12.5% as claimed by the Department. The Committee felt that this dismal rate of progress in the construction of school buildings amply indicates the low level of coordination between Central and State Government, and State Government and implementing agencies. The Committee was surprised to note that no information on the status of additional classrooms to be constructed have been given by the Department. The Committee emphasized that the Department must take all necessary steps to expedite the construction so that the noble purpose envisaged in the SSA was not defeated. 8.128 The Committee noted that the shortcomings/hindrances as pointed out in quarterly reports of the independent agencies were not new ones. In fact, the Committee have been commenting on these aspects in past also. The Committee would again caution the Department for such lacunae and recommend that concrete efforts be made to remove the bottlenecks in case the goals of universal elementary education were to be achieved in time. Time has come to really act on field in active co-ordination with the implementing agencies, lest the flagship SSA scheme would remain on paper only. 8.129 The Committee was of the considered view that by paying the 'Education Cess' from their hard-earned income, every citizen would watch with concern the performance of this scheme. It, therefore, placed greater responsibility on the Department as well as the State Governments for ensuring that the Abhiyan was taken up as a peoples' movement with the do or die spirit. 8.130 The Committee recognized that primary education was a State subject and the State Governments were the principal implementing agency with regard to SSA. The Committee felt that the success of the Scheme, therefore, largely depended on the active participation of the States. However, the data indicated that the attitude of the State Governments have not been encouraging and in some cases like Bihar, Jharkhand, West Bengal, Assam etc., it have been somewhat grossly indifferent. Such an approach have certainly blocked the much desired pace and momentum under SSA. The Committee would urge upon the State Governments to play a more responsible and pro-active role in successful implementation of the Abhiyan. 8.131 The Committee welcomed the idea of providing computer education even in rural areas under SSA to bridge the existing digital divide. This capital-intensive scheme required proper planning for providing necessary infrastructure and services in the schools in remote villages/clusters. The Committee would only hope that this Scheme also should not remain on paper only. 8.132 In view of the proposal for providing schools in every village/cluster under the SSA, the Committee was of the opinion that it would be appropriate if atleast one school was developed as a model school in every Panchayat area so that others were motivated to follow the suit. 8.133 The Department should complete the procedural formalities in this regard on urgent basis. The Committee also noted that the States like Assam, Meghalaya, Bihar and the UTs of Chandigarh and Daman and Diu were yet to release their matching share under SSA for 2004-05. All these developments must have created serious bottlenecks in recruitment of teachers in these States apart from causing other handicaps in the successful completion of the SSA. The Committee was also of the view that the Department exercise have failed to persuade the defaulting states to release their respective share.

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8.134 9134 NGOs have been funded so far under the Education Guarantee Scheme and Alternative and Innovative Education (EGS & AIE), a component of SSA. The Committee notes that maximum number of NGOs, i.e. 2711 are working in Maharashtra followed by 390 in Tamil Nadu. As per the information made available to the Committee, Rs. 38.45 crores have been granted to these NGOs during the last three years. The Centres being run under this component of SSA are meant to provide an alternative to normal schools. The Committee would like to have an idea about the work done by large number of NGOs in certain States. 8.135 The Committee, therefore, expressed its reservation over the pattern of financing under the Scheme in the ratio of 75:25 between the Centre and the States during the Tenth Five Year and 50:50 thereafter. Only two years were left of the Tenth Plan and not even a single school have become functional so far. In the circumstances, the Committee have, its own doubts about the achievement of the target of opening of 500 to 750 residential schools during the Tenth Plan. Our experience in other schemes showed that States' financial constraints find the burden of sharing even 50 percent of the expenditure quite heavy. The Committee would like the Department to have a re-look at this aspect in most practicable manner. The Committee found it deplorable that this scheme meant for girls belonging to the disadvantaged section - SC/ST have not taken off so far. The Committee recommended that all the schools be made functional during the Tenth Plan itself. 8.136 The Committee would like the Department to ensure that there was no laxity in the construction of school buildings and hostels within the scheduled time otherwise it would not take-off at all. The Committee also desired that the Department should provide heavy penalty clause in the contract for construction agencies. All the clearances required must also be obtained in time. 8.137 Although the extent of under-utilization was not big, the Committee felt strongly about any under-utilisation of funds particularly for such an important scheme as MDM. 8.138 How could there be a continuous decline in allocation of food grains when the enrolment figure was reportedly on the rise? Not only this, even the lifting of food grains had also shown continuous decline during the first three years of the Xth Plan from 2176830 MT to 2130652 MT to 152877 MT (upto 31.12.04). 8.139 This aspect was pointed out by the Committee in its 149th Report and reiterated in 156th Report also. It seemed that Department could not take corrective measures in this regard. Such indifference, the Committee felt, did not augur well for the future of the MDM scheme. The Committee reiterated that the Department must take urgent measures to check this tendency. 8.140 The Committee was happy to note that the remaining five states, viz. Bihar, Jharkhand, Assam, J&K and Goa also have since decided to provide complete cooked meal programme. The Committee felt that since these States were unable to universalize cooked meal and have decided to do it only recently, they might not be able to sustain and continue their efforts. The Department should, therefore, pay special attention on these States to facilitate implementation of the MDM by them. 8.141 The Committee was of the view that transportation of cereals from the FCI godowns was still a major problem in smooth implementation of the Scheme. The Committee have been informed that due to shortage of Plan allocation at the end of Ninth Plan, there were unsettled claims of about Rs. 435 crores due to FCI, which had to be carried over to the Tenth Plan. Only two years were left for the Tenth Plan to be over. The Committee would like to emphasise that the Department would have to take corrective measures so that lifting of grains was not affected. 8.142 Moreover, there were complaints of low quality of cereals being released by the FCI godowns. The quality of the meals being served was something the Committee was very concerned about. The Committee felt that the scheme have fallen short of its goal of providing meal of required quality with an eye on enhancing the nutritional status of the children. As per the guidelines, 100 gm. grain was to be given per child per day. Other requirement was that the meal should have 800 calorie and 8-12 gm. proteins. In view of mostly rice and wheat being provided, the Committee could not say if 100 gm. of these cereals have the required nutritional value. Nutritional deficiency being what it was in rural areas, the Committee felt that giving additional items also, must be considered. It might be possible to do with the recent enhancement of financial assistance for mid-day meals. Besides, enhancing the amount of Re. 1 per child per day, currently being provided, might also be considered. There were many ways of upgrading the quality and variety of the food being provided.

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8.143 There were a number of Ministries/Departments implementing other schemes for providing nutritious food to our children; still our children suffered from massive nutritional deficiency. Convergence and close coordination was required amongst all the agencies at the Centre and State level in this regard. Committee recommended that quality; hygiene and nutritional aspects of the meals served need to be strictly monitored and no leniency should be shown in the event of any lapse on these aspects.

8.144 The Committee desired that the Department must ensure that the funds under various Centrally – assisted Schemes were released for MDM on time and also that every Village Education Committee (VEC) was aware about these provisions so that there was no delay or confusion in getting these facilities.

8.145 The Committee, in view of experience in past, have a word of caution in this regard. The Department would have to make extra efforts to ensure that State Governments do establish SMCs on priority basis. The Department would do better to remember that the responsibility to monitor the implementation of the Scheme should essentially lie with the Central Government. It was also true that States have to play crucial role in this scheme. Therefore, overall it should be a joint effort particularly in view of the 'Education Cess’, being collected at national level, a big share of which have gone into financing the MDM Scheme. 8.146 Despite the problems/drawbacks noticed in implementing the MDM scheme, the Committee wanted to put on record its appreciations for Department's efforts which have brought about some increase in the enrolment figure and the scheme was certainly bringing a difference on educational spectrum. However, the Committee's only fear was that with the rise in enrolment of students, strain on resources and infrastructure might also increase. The Committee cautioned that the Department should take all measures to meet the situation, which may arise in future. 8.147 The Committee noted the laudable aims of the programme not only for strengthening but also creating sound institutional infrastructure for both pre-service and in-service training of elementary as well as secondary school teachers in the country. This Committee in the past also have been expressing its concern about the poor performance of this scheme during the 9th Plan. The Committee noted that even during the 10th Plan, the programme did not appear to have taken off. 8.148 The Committee observed that against a target of setting up of 100 new DIETs and 125 CTEs & IASEs, during the Ninth Plan, only 39 DIETs and 9 CTEs and 4 IASEs could be set up. As a result, allocated funds for the strengthening of Teacher Training Institutions also remained under-utilised. The Committee was disappointed to know that the implementation of the scheme during the 10th Plan could take off only in the year 2004-05 i.e. during its third year. As per the revised guidelines issued in January 2004, the Committee noted that the main objective of the scheme during the 10th Plan was to make up for the shortages in completion as well as operationalisation of the sanctioned institutions/projects during the 9th Plan. Therefore, currently, the emphasis of this scheme was not on expansion but on clearing the backlogs of yester years. This scenario reflected the poor performance of the scheme crystal clear. The Committee failed to understand as to how the Department would be able to fulfill its objectives of this scheme in remaining just two years of the 10th Five Year Plan. Trend of under-utilisation of allocated funds during 2003-2004 and 2004-2005 and also delay in the revision of Teacher Education Scheme indicated that there might not be any noticeable improvement in Tenth Plan also. The Committee appreciated certain practical problems vis-a-vis formulation and finalization of a State plan which was dependent upon State Implementing Reform Agencies such as recruitment, placement, etc. for teachers education. The Committee noted that target for 2005-2006 was setting up of 15 DIETs, 10 CTEs and 3 IASEs. The Committee hoped that these Training Institutes would be set up during 2005-2006. The Committee would also like to be apprised about the status of 52 new DIETs, 10 CTEs/IASEs approved in 2004-2005 after the revision of the Scheme. 8.149 The Committee observed that against 550 sanctioned DIETs and 102 sanctioned CTEs, only 436 DIETs and 91 CTEs were operational at present. Shortfall was mainly there in 4-5 States. In Madhya Pradesh, against 45 sanctioned DIETs, only 38 were operational. Similarly, only 13 DIETs were operational in Orissa, against sanctioned 30 DIETs. The Committee would like to understand the constraints being faced in making sanctioned DIETs/CTEs operational. The Committee was more worried about the status of these bodies in Bihar and Jharkhand. In Bihar, out of 37 districts, DIETs have been sanctioned only in 24 districts, and out of these 24 sanctioned DIETs, only 18 were operational. Similarly, in Jharkhand, out of 22 districts, only 10 DIETs have been sanctioned and 9 were operational. While giving the state-wise break-up of DIETs and CTEs, the Department have, however, informed that their status in Bihar and Jharkhand was bring verified. The Committee was constrained to observe that the Department had its own doubts about the functional status of DIETs in Bihar and Jharkhand.

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8.150 The Committee would also like to be apprised about the monitoring mechanism for these institutes. Findings of latest survey done about the functioning of these institutes may also be conveyed to the Committee. 8.151 The Committee have been informed that dispensing with the requirement of NOC for B.Ed courses by NCTE had been done with a view to meet additional requirement of trained teachers at elementary level in the context of SSA. The Committee understood that NCTE have been requested to furnish state-wise details about the number of teacher-training colleges set up during 2003-2004 and 2004-2005. The Committee might be apprised about the same alongwith the functional status of such colleges. 8.152 The Committee felt that since trained teachers were indispensable for the training of young minds, the Department must take all steps to persuade those States, who have failed to initiate appropriate reforms for making themselves eligible for central funding. In fact, the Department needed to play a more pro-active role by facilitating the States and other agencies to come forward with their plans. 8.153 The Committee did not agree with these at all because the facts in certain respects did not support these conclusions. Despite the increase in enrolments over the years, the average Student Class Ratio (SCR) for schools covered under DPEP have come down from nearly 50 in 1996-97 to 42 in 2002-2003. Also, the dropout rate of children between grade I to V, have been found to be between 10-20 per cent in one third of the districts covered under the programme. The Committee desired that the Department should look into the factors for dropouts and remedy the situation by making schools attractive to the child. The Committee was not ready to buy the off-repeated argument that poverty and illiteracy of the parents are the main factors for dissuading child from studies. In fact, the Committee was of the considered view that the poor and uneducated today, in fact, were more eager to send their children to schools. 8.154 As regards fiscal performance, the Committee noted that out of the total release of Rs. 777.61 crores in 2003-2004, Rs. 693.16 crores only have been utilized. The Committee further noted that the utilization of funds by the States particularly Bihar, West Bengal and Orissa, has been particularly low i.e. 37.7%, 71.90% and 61.07% respectively. 8.155 The Committee was not in agreement with the conclusions of the assessing agencies about achievements of DPEP, which did not go with the ground realities in respect of various components of this programme. In view of the present coverage of DPEP and project period yet to be over, the Committee strongly felt that vigorous monitoring by independent teams should be undertaken by the Department. State data would not be sufficient in view of various education indicators for these DPEP covered districts. The Committee was also of the view that involvement of public representatives about the implementation of DPEP in a particular district would prove helpful in arriving at the right conclusion about the effectiveness of this programme. 8.156 The Committee noted that most of the components of the DPEP were the same, which have been provided in the SSA also. The Committee felt that this aspect should have been seen while formulating/launching the SSA in the year 2001-2002 with a view to avoid overlapping in the objectives. 8.157 The Committee also would like to point out that the main objectives of the DPEP like reducing dropout rate to less than 10% and reducing gender associated disparities regarding enrolment etc., to less than 5%, were set without fixing any time frame, as have been done in the case of the SSA. The Committee disapproved of such an open-ended approach. That is why, perhaps these goals have remained elusive. In the light of this, the Department should see that the scheme produce better results in the remaining period.

8.158 It was not clear to the Committee as to why direct funding to Bihar and Jharkhand was not allowed on the plea that DPEP funding to these States was extended till September, 2005. But the Committee noted that objectives of this Scheme and the DPEP were quite different. Besides, the Committee failed to understand as to why this situation was faced only in the case of Bihar and Jharkhand particularly when States like Andhra Pradesh, U.P. and Uttranchal were also covered under MS Scheme as well as DPEP. Funding under DPEP have also been extended upto September, 2008 in these States. The Committee would like to have further information in this regard.

8.159 The Committee was dismayed to note that the BE allocations for the MS Scheme had been reduced at RE during the last three years. The Department have failed to utilize even its reduced allocation in the years, 2003-2003, 2003-2004 and 2004-2005. It was also disappointed to note that the post of Consultants in the

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National Office of Mahila Samakhya could be filled only in February 2004, which remained vacant for a long time. The Committee would like the Department to ensure that all the resource persons were appointed in time for the successful implementation of the Scheme.

8.160 The Committee was not inclined to agree with the contentions of the Department given above, which appeared to be an attempt to mystify the whole thing. After all, basic aim of the programme was to enable our women, most of whom were in rural areas, illiterate, poor, with little powers either in their family or in the society. The Committee failed to comprehend as to how the Department proposed to enable such target groups to learn to question critically, analyzing issues and programmes and seeking solutions, set their own priorities, seek knowledge and information, to make informed choices, etc. The Committee felt that there have to be some kind of enabling activities for achieving these objectives. The Committee was of the firm opinion that it was possible to fix targets in respect of those activities both in terms of number as well as time-schedule. The Committee was surprised to see that it have not been done. The Committee reiterated, as it has done in this report in the case of DPEP, that such kind of open -ended approach without fixing targets would lead us nowhere. It, therefore, recommended that targets and time-schedule may be fixed for this scheme also.

8.161 The Committee, however, believed that there should have been a little more allocation because we cannot afford to lose the pace for want of funds. Moreover, the expenditure under Total Literacy Campaigns and Operation Restoration have outrun the allocation or showed 100 per cent utilisation during the last two years. Also, the scheme of continuing Education was spreading its wing as an additional 55 districts were to be covered in 2005-06. In the light of these developments and the proposed launching of the special literacy drive in 150 districts of the country, the Committee desired that Adult Education Schemes should be given the required funds.

8.162 The Committee, however, took note of the under-utilisation of the allocated funds of Rs. 157.24 crore under the Scheme of Continuing Education as only Rs. 123.36 core was spent till 21.3.2005. The Committee recommended that the Department must ensure that similar situation did not arise in future.

8.163 The Committee would like to have an idea about the work done by these NGOs in 2003-04 and 2004-05. 8.164 The Committee appreciated that more than 250 types of courses and activities were offered by JSS but the Committee expressed its concern over the fact that out of an allocation of Rs. 28.00 crores for 2004-05, a total of Rs. 21.87 crores only had been sanctioned till 28.2.2005. The Committee felt that the Department ought to have utilized the funds well in time than going for the last minute rush. It should be strictly avoided in future. 8.165 The Committee noted that the allocation for 2005-06 have been enhanced to Rs. 39.55 crores. It desires that the Department ensure the proper and timely utilisation of the funds. 8.166 The Committee learnt that persons benefited under the Scheme have been increasing and in 2003-04, it was 16.66 lakhs compared to 14.74 lakhs in 2002-2003. The Committee felt that though there were no fixed quantitative targets to be achieved, yet the quantum of beneficiaries should have been more than what it was today. It hopes that the Department with the enhanced allocations would take necessary measures to cover more people within the ambit of JSS. Moreover, the Committee did not know the level of absorption in industry, of the beneficiaries of the vocational courses run by these Sansthans or those going for self-employment. It desired that the Department should undertake some kind of survey to find out this fact, which would give a clear picture about the utility as well as success of this programme. 8.167 The Committee was concerned that high dropouts rates are still persisting-43.89% from class I to V and 52.8% from class I to VIII. 8.168 The Committee was anguished to take note of the fact that the above-mentioned States were the ones where the DPEP was still functioning, besides the SSA and MDM Scheme. It felt that the Department should take some concrete and hard measures to improve the situation. 8.169 The Committee found it strange and paradoxical that objectives of all our schemes were removal of the same, which were also the factors responsible for dropouts. It is, in fact, a sad commentary on all our

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efforts/schemes meant for universalization of elementary education. In other words, there were no results commensurate with our resources invested for this purpose. 8.170 Besides dropouts, the Committee noted that a large number of our children were still out of schools. It appeared that we have not been able to bring the children of poor parents to schools, despite most of the Department's programmes on primary education having particular focus on children from disadvantaged sections of the society. Similarly, under SSA, strategies have been chalked out to educate first generation learners. 8.171 The MDM scheme, no doubt, have not only attracted children to the schools but also in retaining them but the Committee felt that this scheme had not had the desired impact in attracting children from poor families, which was one of its main objectives. In such a scenario, sustained efforts would now to be made for achieving the two main objectives of the SSA (i) universalizing primary schooling by 2007 and (ii) elementary education by 2010, otherwise it might remain elusive. 8.172 The Committee, no doubt, was aware of some inherent and practical limitation in achieving hundred per cent enrolment as well as retention of the students in schools. Factors responsible for this were many and complex. However, in view of successes achieved in this regard by States like Kerala and Tamil Nadu, which have very low dropout, our efforts should be to imitate their example and apply those strategies for poorly performing States. (Para 10.8) 8.173 The Committee was of the opinion that the children who have dropped out can be integrated with the Continuing Education Programmes of Adult Education so that they were able to undertake activities relating to income generation providing skills in area specific activities. 8.174 The Committee felt that a 'Learn while you Earn' scheme could be an effective measure for retaining the students in the schools. It therefore, recommended that the Government should consider the proposal of providing suitable vocational education to desirous children at the upper primary stage so that those who cannot for any reason pursue education beyond class VIII, enter the world and earn their livelihood. (f) 159th Report 8.175 The Committee appreciated the enhancement in total allocation of the Department but was not satisfied with the trend of utilization of allocations. It was intriguing that Rs. 267 crores were spent in just 25 days i.e. from 4 to 29 March 2005. Going by the Department's claim of 95 per cent expenditure, the figure would actually cross Rs. 2100 crores, which meant more than Rs. 400 crores were spent in the month of March 2005 itself. This was certainly a disturbing trend of expenditure. 8.176 The Committee was informed that whereas some of the schemes had been approved as late as early 2005, there were others for which funds were released in the last quarter. The Committee was aware that 100% utilization was difficult in view of some structural problems. For example State Governments were not able to furnish the Utilization Certificates in time, which caused delay in the further release of funds. However, this should not be taken as a plea for less/under utilization of funds. The Committee felt that the first installment to the States, must begin in April itself and the further installment might be released in the next quarter, if they are able to show that they have spent 50% of the first installment. For the remaining 50%, sufficient time could be given to them for submitting Utilization Certificates and completing other formalities.

8.177 It was therefore, evident that non-receipt of the Utilization Certificate was not the only reason for under-utilization of the allocations. The Committee felt that lack of preparedness; foresight and commitment of the part of Department were also equally responsible in this regard. 8.178 The Committee noted that there are some schemes, which have become difficult to implement/monitor from the Centre, resulting in their poor implementation. The Committee was of the view that the Department might identify such schemes and take up with the States as well as the Planning Commission to find out on effective strategy for their smooth functioning. The Committee would also like to review its past financial commitment in regard to those schemes, which it wanted to close or revise before starting new schemes. 8.179 The Committee expressed its displeasure at the non-utilisation of funds and the way in which these programmes were being managed. The Committee would like to be apprised of the reasons for the non-

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utilization of funds and recommended that steps be taken to see that the hurdles were removed and the Schemes were implemented in the year 2005-2006. 8.180 The Committee was concerned to see that the money being allocated could not be utilized for the last three years, despite allocations being made every year for the college. The Committee, therefore, recommended that urgent measures should be taken for removing the hurdles so that money could be utilized. 8.181 The Committee was not ready to buy any argument on the under utilization and re-appropriation of the allocated funds. It was not a good practice. The Committee might be apprised about the details about utilization of the re-appropriated fund meant for new polytechnics and infrastructure development in existing polytechnics. 8.182 The Committee noted that despite various new initiatives proposed by NCERT to carry out in the year 2005-06, allocation to it have been kept the same as that of last year. This pointed to the fact that programmes and initiatives have been envisaged without adequate financial backing. The Committee, therefore, apprehended that the proposed new initiatives as well as its on going programmes might suffer due to want of funds in the year 2005-06. Therefore, more funds might be given for NCERT at RE stage. 8.183 The Committee noted that NCERT could achieve the physical target of only 1512 programmes against a target of 2115 programmes set for the Ninth Plan. The achievement of financial target also was Rs. 10 crore less during the Ninth Plan. This was not a good sign for an effective functioning of the institution. The Committee was informed that during the year 2004-05 the RE for NCERT was fixed at Rs. 17.10 crores but the actual utilization upto March 2005 was only Rs. 12 crores. The Committee observed that utilization of NCERT budget is not upto the mark especially, when it was a central body and directly implementing almost all of its schemes. The Committee only hoped that the NCERT must have reviewed its programmes as well as targets for the Tenth Plan for achieving the cent percent physical and financial targets.

8.184 The Committee have been observing the progress being made in the construction of PSSCIVE, Bhopal and NERIE, Shillong. The Committee noted that proposal for construction of buildings for PSSCIVE, Bhopal have finally been approved by the SFC on 13th October, 2004 and approval of Human Resource Minister has also been conveyed to NCERT. The Committee hoped that phase –I of construction work must have been completed during 2004-05 and as planned, construction work would be completed in 2005-06. The Committee, however, was constrained to observe that construction work of NERIE, Shillong continued to be in the planning stage due to late receipt of revised cost estimate from the CPWD. The Committee apprehended that there were remote chances of the construction work being started as proposal was yet to be placed before the SFC. The Committee would like to emphasise that construction project for NERIE, Shillong should be closely monitored to avoid any further delay as well as increase in its cost estimate.

8.185 The Committee also have been emphasizing the need for opening more and more Vidyalayas throughout India. The Committee appreciated the move on the part of the Department and the Planning Commission for identifying 15 special focus districts for opening new KVs. The Committee recommended that the Government might review the existing norms with a view to establishing more and more Kendriya Vidyalayas in the country, because these schools have the potential for competing with the public schools, which were beyond reach of the general public.

8.186 The Committee noted that KVS have plan to open 50 KVs this year, in addition to 15 more schools in special focus districts. The Committee hoped that the KVS would be able to undertake all its commitments - past, present as well as future, with this enhanced allocation. 8.187 The Committee, therefore, recommended that IT should be introduced as on elective subject to all the remaining KVs in a phased manner, if not, during the year 2005-2006 itself. 8.188 The Committee, in view of innumerable cases of transfers in KVs on the basis of extraneous pressures and considerations reported from time to time, felt that the transfer policy was not being implemented in letter and spirit. It was aware of some practical limitations in this matter. It, however, emphasized that this policy needs to be effected with sensitivity and human face because most of the transfer requests were based on human considerations. There have to be maximum transparency in this regard.

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8.189 The Committee failed to understand the shortfall in the construction of Vidyalaya buildings in spite of additional funds being provided therefor during 2004-05. 8.190 The Committee was of the view that either the targets were being fixed without examining their feasibility or construction work was being delayed due to procedural problem. In either case, there was a need for proper analysis of the root cause of the prevailing situation and finding solutions. Therefore, the Committee hoped that the pending construction works would be completed within a fixed schedule, there being additional allocation of Rs. 110 crore earmarked for the purpose.

8.191 The Committee recommended that in future the plan of construction of building of NVs must contain a provision for enabling the orthopaedically handicapped to access the school building, class rooms and the hostel facilities.

8.192 The Committee was concerned to note that though 75 per cent seats were reserved for students from rural areas, actual percentage of students from rural areas has declined to 70 percent in 2003-04. The Committee felt that this was against the very objective of the JNV scheme, which was basically for talented children specially from rural areas. The Committee was not inclined to believe that it could be due to non-availability of talented students in our villages. It was a serious development and immediate measures should be taken to correct this situation so that rural students get preference. The Committee was surprised to note that despite of the increase in allocation for JNV, the number of dropouts have also increased equally. Lateral entry in other classes should also be allowed to fill the seats vacated by dropouts or transfers etc.

8.193 The Committee was, however, disturbed to note that this exchange programme have taken a beating since the percentage of students participating in this programme was declining from 92.12 per cent in 1997-98 to 78.70% in 2003-2004. The Committee felt that there must be some valid reasons for this sudden decline. The Committee desired that the Department might look into the reasons for this decline and take necessary steps to improve the percentage. 8.194 The Committee observed that the mission of National Open Schooling was to provide continuing education to those who have missed opportunities to complete their school education. To achieve this noble aim, the Committee felt that, paucity of funds should not be an obstacle. 8.195 The Committee noted that the number of study centers of NIOS have come down from 2500 in 2003-2004 to 2400 in 2004-2005. The Committee failed to understand why there is a reduction of hundred study centers in a single year. The Committee might be apprised about the reasons for the reduction in the number of Study Centres. The Committee recommended that Government should take every possible step to ensure that more and more study centers are opened for reaching the un-reached. 8.196 The Committee felt that the delay in approval of such a good scheme is not acceptable. The Committee held the Department and the related agencies responsible for this, who failed to get the revised scheme approved in time. The Committee recommended that all out efforts should be made for the full utilization of Rs. 45 crores allocated in the budget 2005-06. The Committee felt this allocation would hardly be adequate for implementing the scheme with required pace.

8.197 The Committee appreciated the targets achieved in the IEDC scheme despite the fact that some of the major States were not implementing the scheme. The Committee was of the view that the Department should effectively intervene to remove the difficulties/constraints being faced in the implementation of the scheme by these States. The Department might take the initiative for special focusing on these States by arranging exclusive training programmes for teachers and also required specialized educational aids and assistive devices. If need be, the matter might also be taken up with respective Chief Ministers of those States, which were not implementing the schemes meant for disabled children. 8.198 The committee would like to be apprised about State-wise funds released to States and NGOs separately during 2002-03, 2003-04 and 2004-05. 8.199 The Committee also recommended that all out efforts might be made to ensure that allocation of 3% of education sector outlay for disabled children's education was adhered to. The Planning commission might be approached for any support to ensure that the nation should not undermine the aspirations and needs of the disabled children.

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8.200 The Committee welcomed this ambitious Action Plan for Children with special needs and hoped that action to implement the same would be initiated at the earliest. The Committee was of the opinion that the Department ensure that all the schools be made disabled friendly by the end of the Eleventh Plan i.e. 2012. 8.201 The Committee was surprised to note that revision of this scheme was hanging fire for a long time. Even after a lapse of almost 9 months the Department could not finalise the draft Cabinet Note for the CCEA. Allocation of only Rs. 9.00 crores for 2005-06 as compared to much higher allocations being made in the first three years of Tenth Plan indicated that the chances of the Scheme being finalized and becoming operational during 2005-06 were not there. The Committee was constrained to say that an important scheme for improving quality in schools have not been handled in an effective manner. The Committee, therefore, recommended that all out efforts be made to ensure that the scheme gets approval from all the concerned authorities and implemented without any further delay. 8.202 The Committee in the past also have been emphasizing the need for converging schemes with overlapping mandates with a view to avoiding duplication of efforts and resources. But in the instant case, the Committee noted that schemes with different mandates were being converged under one Scheme for Quality Improvement in Schools. 8.203 Apparently, there was no co-relation between the name of the Scheme and the nature of the components that were proposed to be put under it. The Committee did not know the rationale behind this convergence, unless it was being done for administrative convenience. The Committee would like to know the reasons behind it. 8.204 The Committee was not convinced by the criteria for grant of funds to NGOs under the existing scheme. There have to be an even distribution of grants as this scheme was meant for the entire country. Presently, it was seemingly being confined to only a few States. It reflected the lop-sided manner in which this scheme was being handled. The Committee recommended that a clear policy for providing grants to NGOs from all areas might be put in place at the earliest. 8.205 The Committee observed that there was lack of seriousness on the part of the Government to finalise the programme at the earliest and implement in right earnest. 8.206 The Committee recommended that the State Governments might be directed to depute a senior officer of Education Department, if the District Magistrate was not available for carrying out the required inspections. 8.207 The Committee felt that in the case of 'Access and Equity' also there was hardly any co-relation between the name of the scheme and the components of it. It creates confusion, which should be avoided. 8.208 The Committee was not at all happy with this tendency of last minute spending. The Committee noted that this was happening in many other schemes year after year. The Committee further notes that all the required formalities were completed only in the last quarter and funds were released in bulk. Utilization of funds had to be even in all the quarters. It was not a healthy practice in fiscal area. The Committee therefore, recommended that the release of funds might be made uniform throughout the year.

8.209 The Committee noticed that students were under tremendous pressure, which led sometimes to suicides by them particularly during Board examinations. The Committee was alarmed on this aspect. The Committee have been informed that CBSE have taken a number of steps to reduce stress among students as indicated below –

- Launching of ‘helpline’ one month before the commencement of examination also before the declaration of results.

- Publication of sample question papers and marking schemes to familirise students and teachers about the nature of questions and question papers.

- Elimination of overall aggregation of marks to reduce unhealthy competition among students.

- Introduction of comprehensive and continuous school-based evaluation.

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8.210 The Committee was of the view that besides examination stress, there were various other contributory factors such as parental pressure, increasing competition, fast changing social and economic conditions, etc. which cause depression in students. The Committee appreciated the initiatives taken by the CBSE and hoped that these measures would result in giving a better environment to students. The Committee felt that the current practice of holding Board exams for Secondary and Senior Secondary students at schools other than their own, also generated a kind of fear psychosis amongst them. The Committee was of the view that in order to avoid this, holding board examinations in their own schools, with supervisors/invigilators from different schools, might also be considered. 8.211 The Committee noted that there was a malpractice cell set up by CBSE whose main objective was to keep a vigilant watch on educational activities of private organizations and institutions. The Committee have been informed that so far the following have been identified as fake boards:

- Central Board of Higher Education, Vachaspati Bhavan, Uttam Nagar, New Delhi. - All India Board of Secondary Education, Gazipur, - Central Board of Higher Education, East Patel Nagar, New Delhi. - Board of Adult Education and Training, Brahmpuri, Nangalrai, New Delhi.

8.212 These institutions, the Committee was sure must be fleecing the unsuspecting students for providing degrees/diplomas having no recognition. It must stop. The Committee would like to be apprised about action if any taken against these boards. 8.213 The Committee was amazed to see that funds have been allocated for the purpose of restructuring the AICTE Technical Bureau and its Committees but the Department said that there was no such proposal. The Committee would like to have a clarification in this regard. 8.214 The Committee have learnt that a lot of delay is caused in clearing the proposals for avoiding new approvals by the AICTE. In the current scenario, we could ill afford to do that. The Committee, therefore, recommended that process of according approval by the AICTE needed to be streamlined and made more transparent.

8.215 The Committee was at a loss to see that the Government have not been able to ensure that Institute starts functioning, which was set up in 1995. It was not convinced by the purely technical explanation given for the delay by the Department. It is baffling that it took almost ten years to create a post of Director of an Institute, which was set up in 1995. And now, it was claimed that everything would be in place by 2005-06. The Committee did not have any reason to believe this. The Committee, however, recommended that Department must ensure that the Director was appointed and remaining posts were filled up during 2005-06. It also called upon the Ministry of Finance to provide necessary clearances, etc. on priority basis in the year 2005-06 itself. 8.216 The Committee therefore, recommended that in future the existing programmes could be discontinued only after the alternative programmes have been formulated.

8.217 The Committee was surprised to note that though the proposal for revised Scheme of vocational education was mooted in the year 2002, the revised plan was yet to be finalized. As a result, it could not be implemented last year also. Vocationalisation of education was our priority area and need of the hour, specially in view of the shrinking employment opportunities. The Committee recommended that the revised Vocational Education and Training Programme must be implemented during this financial year itself and adequate fund allocation might be made to the scheme to achieve its objectives. 8.218 However, the Committee was dismayed to note that the utilization of this enhanced allocation have been only Rs. 11.05 crores as on 4.3.2005 which was a mere 34.84 per cent of the allocation. The Committee would like the Department to see that the funds for 2005-06 are utilized properly and judiciously for such an important scheme. 8.219 The Committee felt that the regional distribution of Community Polytechnics was uneven. Particularly, eastern region had only 97 Community Polytechnics. The Committee was of the opinion that the Department should try to open more Community Polytechnics in eastern region which was a backward area having the highest concentration of rural population. The imparting of technical skills would help ameliorate the pitiable

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conditions prevailing there. The Committee felt that the underutilization of funds must have affected the training programmes, thereby defeating the very objective of the Scheme.

8.220 The Committee was given to understand that UGC was actively pursuing its mandate of promotion and coordination in Higher Education. However, the Committee felt that UGC needed to be strengthened to cope with the emerging trends of liberalization, privatization and globalization. The uncomfortable proliferation of private universities with the off- campus centers were one of areas where the UGC have not been effective. The Committee therefore, recommended that the UGC Act might be reviewed and amended to enable the UGC to cope up with the emerging challenges of Higher Education.

8.221 The Committee appreciated that IGNOU gradually was becoming self-supporting. It also have taken certain innovative steps recently and started modern professional courses in a big way. The Committee felt that such an institution should not suffer on account of paucity of funds. It, therefore, should continue getting funds at least to develop infrastructure and maintenance of the university to ensure that IGNOU was not forced to overcharge its students.

8.222 The Committee appreciated the steps taken by the Distance Education Council (DEC) to ensure the quality of the degrees awarded in the Open University system.

8.223 The Committee appreciated the initiatives taken in the North Eastern Region for development of Open University system. The Committee recommendrd that more centres might be opened in the North Eastern to augment the already existing system. 8.224 The Committed notes with concern that the total number of scholarships have been reduced to approximately 28,000 in a year, which by any standard was very low. The Committee therefore, recommended that the number of Scholarships and the total outlay of the scheme might be substantially increased progressively, so that more and more intelligent and needy students were benefitted.

8.225 The Committee did not know the reasons for not having any national Professors currently. The Committee felt that the process of selection of National Professor should be finalized at the earliest and more funds be provided for this Scheme.

8.226 The Committee recommended that at least seven more reputed Institutions might be selected for grant of Rs. 100 crore each for conducting research and development in basic science.

8.227 The Committee noted that no response came from the Department to its specific and pointed queries regarding reasons for its previous VC functioning from Delhi and also for not starting academic activities of the university even after more than 8 years of its existence. Main civil works were yet to commence and the university was housed in some temporary structure at Wardha. 8.228 On a specific query, the Department informed that a fact-finding committee was being set up to go into the affairs of the university. The Committee expressed its displeasure on the way this Vishwavidyalaya named after Mahatma Gandhi have been treated so far. The Committee appreciateed that fact-finding Committee have been appointed and its efforts were on to help improve its functioning. The Committee would like to be apprised of the finding of the proposed fact-finding Committee. It felt that those found guilty should not be allowed to go unpunished.

8.229 The Committee appreciated the initiatives taken by the Department of Secondary & Higher Education to deal with the various aspects of the proliferation of the private universities and the fall out of the Supreme Court judgment in Chattisgarh University Act. The Committee would however, like to add that the recent problem being faced by a very large number of students of private universities should have been foreseen by both UGC and the Department. At the initial stage only, some corrective action could have been taken. Future of enrolled students in these Universities should not be allowed to suffer. The Committee recommended that the Department should vigorously further purse the initiatives they have taken to streamline the private university system.

8.230 The Committee recommended that private investment in higher education was welcome provided it is really helpful to meet the need and aspirations of the young generations and it fitted into the overall policy of the Government at the Central level and at the State level. There should be no compromise in relations to

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standards and quality. While encouraging the private participation, blatant commercialization of higher education needed to be discouraged.

8.231 Obviously any structured private investment in higher education would have to be made through a legislative framework. That might take some time. Investments in this sector have already been put on the automatic route. In this light, till a suitable legislation was in place, at least a Policy Framework be made at the earliest.

8.232 The Committee opined that the States which have done better in elementary education obviously would need more facilities of Higher Education to accommodate all those coming from the elementary stage. If the State Government was not in a position to manage the demand on Higher Education, they were likely to face unrest and strain in the society. It might dilute the achievements in the elementary education. The Committee therefore, recommened that the Government of India should ensure that those States, which have performed well in elementary education, should get higher fund allocation to sustain the achievements in elementary education as well as furthering the Higher Education.

8.233 National Policy on Education, 1986 as well as the NCMP aimed at achieving the target of investing six per cent of the GDP in education but upto 2005-06, slightly more than three per cent only could be achieved. With this rate, the Committee felt that, this goal shall remain unfulfilled. The Committee, therefore, recommended that the target of investing six per cent of GDP in education should be tried to be achieved by the end of the Eleventh Plan.

8.234 The Committee opined that the ground for growth of Higher Education would be made only when there was advancement in elementary education in the region. If not, it may again lead to imbalance in the higher education system. The Committee therefore, recommended that more and more higher education institutions might be established in States where there were advancements in elementary education.

8.235 This, according to the Committee, was a serious matter. The Committee was supposed to submit ATR on ATNs on the last year Demands before the Demands of the succeeding year's were presented to the House. It meant that the Department did not take the Committee's work seriously. The Committee knew that it took time to collect facts from every corner of the country, but if other Departments could, why not the Department of Secondary and Higher Education also did that? The Committee even had advised the Department to send part information that was available and rest could be sent afterward. That also could not be done. The Committee took a serious exception to this and hoped that Department would accord priority and importance that the Committee's work deserved so that it performed its constitutional obligation without any hindrance or delay. (g) 160th Repoort 8.236 The Committee expressed its serious concern over major part of the expenditure being rushed through in the last quarter of the year. Such a trend, in fact, pointed towards some inherent drawbacks both in the system of flow of funds as well as in the delivery mechanism adopted by the Department. The Committee failed to understand the purpose of formulating Annual Action Plan for each and every scheme, clearly identifying both the physical and financial targets to be achieved in every quarter. The Committee called upon the Department to discuss with the States the structural and functional problems that were responsible not only for poor utilization of resources but also manpower and planning. Resources both human and fiscal meant for the welfare of women and children - bedrock of our future society and economy could not be allowed to go waste. 8.237 In view of considerable enhancement in the provision for ICDS during 2005-2006, the Committee recommended that operationlisation of ICDS projects/AW centres should be closely monitored in NE States. 8.238 The Committee was of the view that there should be more focus on operationalising of ICDS projects and AWCs . Efforts should be made at all levels-- Central, State and district level to operationlise all sanctioned and proposed additional projects/AWCs. 8.239 The Committee appreciated the efforts made by the Department in providing more emphasis on supplementary nutrition and expansion of the project to more areas from 2005-2006. The Committee recommended that efforts be made to utilize the amounts for these activities judiciously to avoid any underutilization.

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8.240 The Committee was of the view that the Department should have pursued this issue with the concerned States and only after the feedback was received from them, a final decision should be taken.

8.241 The Committee would also like to reiterate its earlier recommendation that the norm of one Anganwadi Centre for 700 populations in tribal projects needed to be re-looked for revision in the case of inaccessible areas. Instead of one AWC for 700 population, one centre per hillock/ cluster should be the criteria for hilly or desert areas like Manipur and Rajasthan and same may be applied in other States having similar geographic locations. 8.242 The Committee shared the plight of Anganwadi Workers. The Committee, therefore, desired that the final recommendations might be framed in a time bound period and the implementation process should also be formulated so that the grievances of Anganwadi workers were settled. 8.243 The Committee was perturbed to note the vacancies in regard to the key positions of Anganwadi Centres. The Committee wondered how the programme could achieve its desired result if so many vacancies existed. So many 'vacancies must be telling upon', the performance of this major scheme. The Committee, therefore, recommended that immediate steps should be taken to remove the shortcomings faced in the programme.

8.244 The Committee would like to be apprised about the findings of evaluation study, if done, of these two interventions under the ICDS programme.

8.245 The Committee would appreciate a Pilot Project for evaluation of impact of these interventions was undertaken in one district each from all these States. 8.246 The Committee would like to be apprised about the remedial steps initiated on the basis of findings of this survey. 8.247 The Committee recommended that for construction of anganwadi centre, provision of drinking water etc. feasibility of taking benefits from schemes of other Departments like Rural Development, Panchayati Raj etc could be explored. The funds from MPLADS could also be utilized for this purpose.

8.248 Committee reiterates that different schemes of child nutrition being implemented by various Ministries/Departments and also at State level needed to be brought under one nodal agency with special focus on tribal and remote areas of the country. Interdepartmental meetings for setting nutrition goals and framing the strategy for achieving the same did not seem to have led to any visible improvement. The Committee, therefore, reiterated that the Department mandated to look after the welfare of children and women have to play a more pro-active role. 8.249 The Committee hoped that all out efforts wouldl be made for expediting the extension of the scheme without much loss of time so that implementation of the schemes was not discontinued.

8.250 The Committee apprehended a huge backlog of training in all these States/UTs. The Committee would like the Department to take urgent steps for expediting the submission of action plan by the States/UTs. 8.251 The Committee would like to point out that with NIPCCD as the nodal agency for conducting training programmes, status of training programme should have been better. The Committee would like to be apprised about the number of training programmes conducted by NPCCD and State Govts./NGOs state-wise during 2003-04 and 2004-05. The Committee recommended that efforts should be made to operationalise all the training centers with full capacity at the earliest. The Committee was constrained to say that with the proposed increase of 1,86,168 AWCs, fresh batches of ICDS functionaries have to be trained. The Committee recommended that all out efforts have to be made by the Department to streamline the training programme in a time bound manner. 8.252 The Committee would like to be apprised about the findings of the Report and follow up action taken thereon. 8.253 The Committee observed that delay in the revision of the Scheme was being cited as the main reason for underutilization of funds. This position have continued since the beginning of the Tenth Plan. The

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Committee however, found that only progress made since then was that this proposal have received the approval of the Minister and an EFC memo was under circulation. 8.254 The Committee was not happy with the coverage of children as well as number of crèches in the country.

8.255 This scheme was meant to provide day care services for the children (0-5 years) of mainly casual, migrant, agricultural and construction laborers. The Committee wondered about the constraints being faced by the Central Social Welfare Board and two national level voluntary organizations, Indian Council for Child Welfare and Bharatiya Adimjati Sevak Sangh in establishing these crèches in underserved areas. The Committee recommended that necessary steps should be taken to increase the number of crèches and make them operational. 8.256 With the number of creches remaining the same, variation in the level of expenditure every year did not seem to be proper. The Committee would like to be enlightened in this regard. 8.257 Thereafter, crèches were to be run on self-supporting basis. The Committee would like to know about the assessment about crèches, which have completed five years of their establishment and are running on a self-supporting basis.

8.258 The Committee was not satisfied with the monitoring mechanism of Department. The very fact that unspent balances were available with the implementing agencies indicated that crèches are not providing the services for which they are meant. The Committee desired that steps should be taken for removal of constraints being faced in the implementation of this scheme by regular monitoring and interaction between the State Boards and the CSWB. The Committee also recommended that a special drive for settlement of accounts should be initiated to stop misutilisation/underutilization of funds. 8.259 The Committee was constrained to note that in a number of States, in spite of accounts being settled and utilization certificates being received upto a particular year, unspent balances still remained with the State Boards. The Committee have been given to understand that funds for second year batch were released, subject to the condition of 50% pass percentage, satisfactory performance and settlement of accounts. The Committee was of the view that if this norm had been strictly adhered to, unspent balances, would not have been there. The Committee, recommended that special drive should be initiated for settlement of accounts of the States under the Scheme.

8.260 The Committee was of the view that the Working Group should evaluate the scheme and give its report at the earliest. The Committee would like to be apprised about the number of residential courses being run under the Scheme (state-wise) and also the maximum limit of financial assistance being released per course both for residential and non-residential courses separately. 8.261 The Committee expressed its serious concern about the way the Balika Samriddhi Yojana was being implemented. Scheme launched in the first year of Ninth Plan, i.e. 1997-98 had to be recast after two years of its implementation. In the third year, the scheme had to be reviewed again and recast. The Committee was left with no other alternative but to conclude that the scheme suffered from inherent drawbacks, which continued to be there in spite of review of the scheme being done not once, but on two occasions. The Committee doubted whether the funds released so far have reached the targetted beneficiaries.

8.262 The Committee also felt that in the event of a decision being taken for continuance of this Scheme, then very effective monitoring mechanism and also sufficient publicity for making the targeted beneficiaries aware would have to be an essential component of the Scheme. 8.263 The Committee was constrained to note that not only allocation, but the trend of utilisation also shows a declining trend. 8.264 The Committee would like to be apprised about the funding pattern for these three States under the scheme during 2005-2006.

8.265 The Committee would like to have the feedback in this regard.

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8.266 The Committee was constrained to note that instead of reviewing the feasibility of merger of both the schemes, the Department simply took the decision to transfer both the schemes to States and even action on this decision was yet to be initiated. The Committee apprehended that Tenth Plan would be over in another two years and fate of these two schemes would remain undecided. The Committee would, therefore, emphasise that the Department should review both the schemes and then decide either merger of both of them and have a single composite scheme or go for transfer to the States. In either case action should be taken at the earliest. The Committee would also like to add that the transfer of the schemes not performing well to the states could not be considered a wise decision.

8.267 The Committee was of the view that although funding agency was different in these two schemes, for better implementation and also management, it would be appropriate if these two schemes were also merged.

8.268 The Committee felt that there was a need for persuading such states to take benefit of the scheme of Short Stay Homes. It could not be that these states were not having needy women to rehabilitate themselves at Short Stay Homes. CSWB through whom funds were released should play a more pro-active role in this regard.

8.269 The Committee noted that the pattern of expenditure, staff and type of services provided in the above programmes was almost similar. The Committee felt that it would be better and practical if one comprehensive programme was administered by CSWB. Services provided under these programmes were also available under ICDS and variety of women welfare programmes. The Committee was of the view that the efficacy of identical programmes being run in limited number of States might be reviewed by CSWB/Department.

8.270 The Committee felt that the working of the Central Social Welfare Board and its state counterparts needed to be further strengthened and their network might be utilized for monitoring implementation of different schemes of the Department at different levels.

8.271 The Committee noted that the rate of interest on credit to NGOs is 8% p.a. However, the NGOs further gave credit to SHGs/Beneficiaries at 18% p.a. (maximum). The maximum amount of loan is Rs. 15,000 per borrower. The Committee felt that the rate of interest charged was too high when compared to the market rate. The Committee failed to understand the rationale for such a difference in the rate of interest from 5 -18% to be charged by the Govt. from the implementing agencies and beneficiaries. The beneficiaries were supposed to be poor women. The Committee wondered whether they could ever be in a position to pay back loan taken by them. The Committee, therefore, recommended that the rate of interest should be reduced to facilitate women to take advantage of the scheme.

8.272 The Committee was of the view that the target / objective of the scheme of “Rescue of victims of trafficking” could be easily covered under the scheme of “Swadhar” which was more broad-based. Since the scheme of Rescue of victims of trafficking was yet to be launched, the Department should consider merging the scheme with modifications/ improvement in the existing scheme of ‘Swadhar’. 8.273 The Committee would like to be apprised about the criteria for funding under the scheme of Swadhar. The Committee was given to understand that there was a delay in obtaining Utilisation Certificates from NGOs/States. 8.274 The Committee recommended that proper monitoring of the scheme was the need of the hour to set the process of obtaining Utilisation Certificates from all the States/UTs.

8.275 The Committee noted the implementation of the scheme at snail pace. It seemed no specific purpose was being performed by the mission since some of the objectives were already covered under the scheme of ICDS. The Department should strive to define its target/objective and than implement the scheme. 8.276 The Committee reiterated that there should be specific guidelines; whereunder number of NGOs in a district should be restricted. 8.277 The Committee felt that this exercise deserves appreciation. The Committee would like to be apprised about the latest inter-ministerial review undertaken by the Department. The Committee would also like to

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know whether similar schemes overlapping each other being handled by different Ministries/Department have come to notice, if so, what stand have been taken in respect of such schemes. The Committee would also like to know the important remedial measures suggested after these reviews.

8.278 The Committee recommended that assessment of schemes being implemented by the State and Central Government should be made. The achievement of all the states should be evaluated. Good performing States might be popularized and study on the implementation procedure by these States might be made so that other States might take guidance from them.

(h) 162nd Report

8.279 The Committee would like to have a status report indicating the year the project was cleared, funds allocated, year the construction started, reasons for delay, revised estimate. The Committee would like to have an idea about the monitoring mechanism, if any, for construction of Vidyalaya buildings. In the event of there being no such monitoring mechanism, the Committee would like to emphasise that such a mechanism have to be there to expedite the completion of all pending projects.

8.280 The Committee have been given to understand that in the case of 44 Vidyalayas, school building is under planning. Details of such Vidyalayas revealed their status to be very discouraging. The Committee noted that construction agencies have been requested for preliminary drawings and estimates in respect of these Vidyalayas. Year of opening of these Vidyalayas dates from 1976-77 (Old Cantt., Allahabad) to 1999-2000 (No.2, Roorkee). Only two Vidyalayas have been sanctioned in 2003-2004. Majority of the sponsoring agencies were from Defence/Army/Air Force/Para-military forces. The Committee strongly felt that KVS had to play a pro-active role in providing proper school buildings in respect of all the 44 Vidyalayas mentioned above. With the availability of required land for school buildings, it became the responsibility of KVS to take the initiative in active collaboration with their Regional Offices to get the construction expedited. 8.281 In such a situation, the Committee did not have much hope about the remaining 86 Vidyalayas opened in 2003-2004 and 2004-2005. The Committee strongly felt that the condition of provision of 15 acres of land, free of cost by the sponsoring agency seemed to be there on paper only in such cases. The Committee was of the view that prescribed norms should ordinarily be adhered to, but in the areas where land was not easily available, this norm might be relaxed. 8.282 Expressing its serious concern over the closure of such a large number of Vidyalayas, the Committee was of the view that the KVS/Department should explore the chances of possible utilization of such closed Vidyalayas. The Committee recommended that the KVS might review the status of sponsoring agencies with a view to reopen some of the closed Vidyalayas wherever feasible. Department/KVS might also approach established and interested local organizations for running closed project sector Vidyalayas – whose students inspite of being shifted to nearest Vidyalayas must be facing inconvenience. 8.283 The Committee have been informed that outstanding dues amounting to Rs. 16.08 crores were pending from some sponsoring agencies. The matter have been referred to the Committee of Secretaries for its consideration by the KVS. The Committee might be apprised about the decision taken in this matter. 8.284 The Committee would like to be apprised about the status of all 95 Vidyalayas opened in 2003-04 and 2004-05, their student intake, teaching/non teaching staff and infrastructure.

8.285 The Committee, therefore, in view of the performance and potential of the Kendriya Vidyalayas in providing quality and affordable school education in the country, strongly recommended to review the existing guidelines at the earliest with a view to having more and more Kendriya Vidyalayas particularly in the rural areas. 8.286 The Committee, however, was of the view that existing norms/guidelines for opening of Kendriya Vidyalayas also needed to be reviewed and modified. Till then, opening of Kendriya Vidyalayas should continue to be in accordance with the existing norms/guidelines.

8.287 The Committee failed to understand in what manner, the students were being adjusted in the next higher class. The Committee felt that this was not a healthy trend.

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8.288 The Committee hoped that a final decision for keeping the salary budget of KVS flexible so that the Commissioner, KVS might be in a position to sanction new posts wherever required might have been taken by now. If not, the matter should be resolved finally. 8.289 The Committee noted that this decision had the approval of KVS. The Committee, however, was of the view that utilization of funds for purposes not originally prescribed could not be considered a healthy trend. Not only this, the Committee understood that VVN collected from each student was to be retained in that particular Vidyalaya and to be utilized for the purpose as approved by the Executive Committee of the Vidyalaya Management Committee. The Committee strongly felts that the idea behind the setting up of VVN was laudable as the authority collecting the funds and assessing the genuine requirements was the same, i.e. the school management. School management was the best judge to make the optimum and judicious utilization of funds without any procedural delays. The Committee, therefore, recommended that the VVN collected from a particular Vidyalaya should be utilized for that Vidyalaya only.

8.290 The Committee felt that part time teachers might be continuing from earlier years also. While appreciating the need for having teachers on contract basis, the Committee would like to emphasize that it should be on a limited scale only. Not only the teaching standard of contractual teachers would be of the same level as that of the regular teachers, feeling of involvement and dedication for the institution would also be missing. Such ad-hoc arrangement should therefore not be allowed to continue for long.

8.291 The Committee strongly felt that urgent steps were required to be taken to fill up the vacant posts of all categories of teachers with regular teachers. The Committee would like to be apprised about school wise sanctioned strength, in position and vacancies of KVs including evening shift KVs in Delhi.

8.292 The Committee appreciated the decision and recommended to implement the system at the earliest.

8.293 The Committee strongly felt that due to the problem of local unemployment inspite of education standards being quite high and also other regional problems; there was an urgent need of educated youth of these areas being provided avenues for joining the mainstream. One effective method could be their due representation in the teaching/non-teaching cadre of KVs. Not only this, recruitment of local people would proves to be beneficial as they would be in a better position to assess the local problems.

8.294 The Committee was of the view that this issue needed to be examined in the legal context. The Committee felt that the best option would be if some percentage/quota of posts in a particular zone was reserved for the local candidates. In that way, national character of Kendriya Vidyalayas would also be maintained.

8.295 Taking a serious view of this development, the Committee felt that not only the selected candidates were being made to suffer for no fault of theirs, students of KVs also continued to be denied the services of required teachers. On a specific query, the Committee have been informed that a one-man Enquiry Committee have been appointed to examine the entire recruitment process and report thereupon. In the meanwhile, all the selected candidates were being appointed on temporary or conditional basis. Their fate hung on the outcome of the enquiry. The Committee was not happy with these developments. The Committee, however, hoped that with a final decision about centralized or zonal selection of teaching/non-teaching cadre and also recommendations of the one-man Enquiry Committee, recruitment procedure would be free from all anomalies and discrepancies in future.

8.296 The Committee noted that repatriation of deputationist Principals to their parent schools have led to a peculiar situation. The deputationist Principals, if senior most teachers in their own Vidyalaya were to continue to discharge the work of Principal. However, in the event of there being other senior teachers, the deputationist Principals had to hand over the charge to their senior colleagues. These decisions of KVS have given rise to litigation causing hardship to Principals and students both. Many deputationists approached CAT and various benches throughout the country, which gave a verdict against them.

8.297 The Committee expressed its displeasure over the manner in which the appointment of Principals have been handled by the Department in general and the KVS in particular. Appointment of a large number of

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Principals on ad-hoc basis and their subsequent regularization clearly indicated the seriousness of KVS in getting the posts of Principal filled up as per the rules. KVS could not escape their accountability by admitting their non-adherence to the rules. The Committee was of this view that this kind of decision and subsequent reversal not only increased the frustration of deputationists but have also harmed the interests of students as well as the institutions. The Committee recommended that the Department should sort out this issue at the earliest to avoid further litigation.

8.298 The Committee noted that service rules were being reviewed now so as to provide only one year of service as Vice-Principal as against three years earlier for promotion to the post of Principal, remedial action was also being taken to update the roster so that accumulated posts of SC/ST posts could be filled up without any further delay. The Committee recommended that remedial action should be expedited to update the roaster by removing lacunae in service rules. It recommended that Principal posts should be filled on regular basis and not on deputations. The Committee hoped that after implementation of all these decisions, things would lead to a better situation.

8.299 Committee’s apprehensions stood confirmed by a recent case of a transfer victim posted as a teacher at Car Nicobar Kendriya Vidyalaya. The Committee noted with dismay that one of the teachers of this Vidyalaya, who was 57 years old and nearing retirement, had been trying with diminishing hope for a transfer back to mainland for the last 3½ years. Admitting that it was a genuine case, the Commissioner, KVS explained that in normal circumstances, a teacher on the verge of retirement should have been posted back to mainland. Expressing its serious concern, the Committee recommended that those staff members who are on the verge of retirement and posted at hard stations should be transferred if they so desire to their choice of place. 8.300 The Committee recommended that the KVS should get a survey done of teaching/non-teaching staff posted at hard stations, with a view to assess the period of their stay. If there are genuine cases of prolonged stay, initiative might be taken to post such employees at a suitable Vidyalaya, preferably of their choice. The Committee was of the view that there should be some special provision for postings at hard stations under the new transfer guidelines. The Committee would also emphasize that there should be an effective mechanism to monitor the requests for transfer so as to avoid the recent tragic case of a teacher of Car Nicobar Kendriya Vidyalaya. 8.301 The Committee would like to be apprised about the details of teachers reinstated (region-wise). 8.302 The Committee was of the opinion that KVS should have a well-drawn action plan in the event of any mishap/natural calamity for all KVs located in disaster prone areas. 8.303 The Committee was of the opinion that teachers' representatives should be nominated to KVS/Board of Governors which was a decision making body with respect to all the aspects of administering KVs. Teachers played a major role in imparting education to the students of KVs. Their absence from such an important body could not be justified. The Committee, therefore, recommended that representation of teachers in the KVS Board of Governors should be considered favourably. 8.304 The Committee appreciated the various initiatives taken by KVS in the realm of information technology. The Committee, however, have reservations about the neighbourhood school component under the Smart School Scheme. Although the initiative was a laudable one, the Committee would like to point out that the KVs should first concentrate on providing all facilities for computer education in KVs. Besides 97 newly opened KVs yet to be provided computers, as many as 357 KVs have only 5 computers each. The Committee strongly felt that the KVS should conduct a survey based on the student strength in each KV and then provide computers on need-based basis. The Committee would like to be apprised about the KVs provided with 5 computers only. The Committee also recommends that an assessment of 31 Smart Schools having 40 computers each might be made at the earliest and wherever, Neighborhood School Scheme have failed to take off, alternate utilization of computers may be planned and acted upon. Special efforts need to be made to provide computer facilities to KVs located in remote and inaccessible areas. Such Schools need to be connected with mainland through IT on priority basis. The Committee would also like to emphasize that more Technology Training Labs need to be established specially in Schools located in remote and backward areas.

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8.305 The Committee was of the view that posting of staff at a particular Regional Office should be need-based. The Committee also felt that while there have been steady increase in the number of Vidyalayas over the years; staff strength at Regional Offices remained unchanged. The Committee was of the firm view that there was an urgent need for making an assessment of actual requirement of staff with number of Vidyalayas being the main criteria. The Committee, accordingly, recommended that the KVS/Department should take remedial steps without any further delay.

8.306 The Committee noted there was an effective system for carrying out inspections of KVs. The Committee hoped that these inspections were being followed by corrective measures. The Committee felt that the system would become more effective if feedback was obtained from local M.Ps. about the functioning of KVs. The views of parents during Parents Teachers Meeting (PTM) were equally important. PTM should be periodically held in all KVs. That would also serve the purpose of inspection.

8.307 The Committee recommended that a day preferably once in a week should be fixed in all regional offices/ headquarters for the teachers to meet the officials and put forward their grievances. This face-to-face interaction would lead to timely solutions of many problem areas.

8.308 The Committee recommended that required funds might be provided to the KVS. The Committee would however, emphasise that the Sangathan should also take steps for optimum and judicious utilization of allocated funds in a time-bound manner.

8.309 The Committee is happy to note the achievement and appreciated the marked improvement in the performance of KVs in respect of average pass percentage of the students. The Committee at the same time noted that there were KVs in certain areas whose performance was not upto the mark. While appreciating the good performance at the national level, the Committee hoped that special attention would be paid to those Vidyalayas where the performance was not very good. The Committee was not aware about any initiative being taken by KVs to provide some incentive to meritorious students. If not, the Committee would like to impress upon the KVS to start a healthy competition among all the Kendriya Vidyalayas by starting a incentive scheme whereunder top ten students of Kendriya Vidyalayas in the class X and class XII Board exams were awarded scholarships and other benefits.

8.310 The Committee would emphasise that status of Vidyalayas operating from both permanent and temporary site should be reflected separately. Only then the factual position would emerge. The Committee hoped that findings of such a survey and also Committee’s recommendations/observations on various aspects of functioning of Kendriya Vidyalayas should lead to corrective action by KVS/ Department.

(i) 163rd Report 8.311 The Committee welcomed the idea of making identifiable allocation for youth programmes by not only the Central Ministries/Departments but by States also. This would provide a clear picture about the efforts and resources devoted for this purpose. Such youth specific allocations be shown by all the Ministries/Departments from the year 2006-07 itself. 8.312 The Committee noted that no time frame have been fixed for this Inter-Sectoral Committee to complete its mandate. Committee’s experience have not been very good in this regard as it caused undue delays. The Committee, therefore, underlined the need for having time-frame to prepare the POA by the ISC. It is necessary that all the stake-holders were taken into confidence by the ISC in this exercise. It must evolve strategies to empower youth by way of ensuring their active participation in the decision making process at all levels. They should be treated as valuable partners in the process of national planning and development. 8.313 The Committee would like to be apprised about the recommendations of the Commission that have been accepted for implementation. The Committee hoped that youth - the future leaders of the country could be made instrumental towards achieving socio-economic changes and technological excellence and thus contributed towards national development. 8.314 The Committee felt that the Ministry's projection for the annual plan, 2005-06 was quite justified because it constituted only 10% increase over the previous year’s allocations and also because the Ministry

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had to fulfill its obligation for the preparations of the Commonwealth Games, 2010 and expansion of NSS upto the school level. There appeared to be no justification in applying cut to its allocations, particularly when the Ministry was able to spend more than 66.72% of its allocation upto December, 2004, as per the existing norms in this regard. 8.315 The Committee considered it disappointingly low in view of the mandate of the Ministry being to develop the personality of our youth as also involving them in nation-building activities. This group, which constituted nearly 40 per cent of total population of India, was the most vibrant and potent segment of our society. Allocation below one per cent to youth development and sports reflected a low preference. The Committee was of the considered opinion that there was a strong case for adequate allocation for the Ministry in the coming years. Department's demand for a share in the funds collected through education cess must be considered favourably, particularly for expansion of NSS upto 9th class and also in all the remaining schools. 8.316 Committee’s attention have also been drawn by the disturbing trend of under-utilisation of funds meant for NE States both under the Youth and Sports Programmes during the Tenth Plan period so far. The Committee was also disturbed by the status of scheme of ‘Promotion of Sports Among Disabled.’ Not even single rupee could be spent under this scheme against the Ninth Plan allocation of Rs. 15 lakhs. Position remained unchanged during the Tenth Plan also so far. This Scheme have been continuing on paper only. Performance Budget of the Department for 2005-06 indicated that the Scheme was now being merged with the Scheme relating to Events. The Committee did not appreciate the way scheme ‘Promotion of Sports among Disabled’, which was meant to serve the under-privileged class of society, was being handled. It needed to be strengthened. 8.317 Even during the Ninth Plan, funds remained underutilised in different categories. For example, of the total Ninth Plan outlay of Rs. 352.24 crores for Youth Welfare, only Rs. 336.94 crores could be spent. The schemes suffering most were: National Reconstruction Corps, Youth Hostels and Rajiv Gandhi Institute of Youth Development. Similarly, spending Rs. 558.50 crores in Ninth Plan period against an outlay of Rs. 472.61 under Sports and Physical Education also indicated towards fiscal (mal)practices such as unspent balances or re-appropriation etc. The Committee was of the view that these situations - under-utilization as well as unspent balances - indicated that both our delivery mechanism as well as system of flow of funds were not foolproof and needed to be streamlined further. It reflected a poor physical performance because it was directly related to the financial performance. 8.318 While appreciating the formulation of quarterly Action Plans during Tenth Plan by the Ministry, the Committee felt that it have not been able to achieve the desired results. The Committee would like to emphasize the need for the judicious and optimum utilisation of funds by the Ministry allocated for various schemes by the Ministry. 8.319 The Committee was of the view that a detailed review of the schemes showing poor performance should be undertaken so as to identify the shortcomings and initiate remedial measures. The Ministry should involve the Planning Commission, the State Governments and other implementing agencies in this exercise. 8.320 The Committee was aware of the structural problems inherent in our system from Union level down to the Panchayats in implementing the central sector as well as centrally-sponsored schemes. Ours being basically a cooperative federation, States have got to play a more pro-active and coordinated role in this exercise for obtaining the desired impact of the schemes at the ground level. 8.321 The Committee felt that adequate publicity should be given to all youth programmes, particularly this new scheme, through print and electronic media. 8.322 What was more surprising was that position was entirely different if achievement level of financial targets was looked at. There was full utilisation of non-plan funds amounting to Rs. 15.54 crore during 2004-05. Against a plan allocation of Rs. 28.97 crores, funds utilised were Rs. 26.01 crores. The Committee failed to understand in what manner allocated funds were utilised with shortfall reported in a number of physical targets. Either the targets were set without any proper groundwork or utilisation was not judicious. Both the situations needed to be clarified. The Committee strongly felt that with significant increase in norms for regular and special programmes conducted by NY Kendras, there was need for monitoring of these Kendras at district, State and Central level. Another disturbing trend noticed by the committee was that the level of female beneficiaries as compared to males was not of the desirable level. The Committee was of the view that an assessment needs to be made in this regard and remedial steps taken.

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8.323 The Committee noted that out of 600 districts in the country, NYKs were there only in 500 districts, out of which, 103 were in difficult areas and 397 were in normal areas. The committee would like to be apprised about the states, which have districts yet to be covered by NYKs. The Committee emphasized the need for opening NYKs in remaining districts also. Its total outreach in terms of beneficiaries was also very low which needed to be expanded in a phased manner. 8.324 The Committee was of the view that in order to fulfill its social responsibility, the Youth Clubs and Mahila Mandals should be encouraged to work as watchdog agencies against drug and human trafficking, HIV/AIDS etc. They needed to be encouraged to actively participate in awareness generation and promoting activities relating to national integration. 8.325 While appreciating the idea of utilising the services of the NYKS by other Ministries/ Departments for improving the outreach of their programmes, the Committee had a word of caution in this regard. The basic mandate of the NY Kendras should not get diluted/ignored, the possibility of which could not be ruled out in this situation. The Committee felt that a well-coordinated monitoring mechanism would be required, if NY Kendras were to participate in schemes run by eight to nine Ministries/agencies. 8.326 In view of the 97 vacant posts of District Youth Coordinators, the Committee expressed its reservations about an effective implementation of such programmes in addition to the programmes being run by NYKS at present. Moreover, nearly 100 districts were yet to have NY Kendras in the country. The Committee recommended that all the existing District Kendras should be equipped with requisite infrastructure and manpower for handling such a large number of programmes. Committee would like to be apprised of details of various State level programmes being undertaken by NYKS. The Committee felt that this was the right initiative taken by the Ministry. The Committee was of the view that a study could be initiated by the Ministry whereunder State and Centre-run programmes could be analysed and element of overlapping if any, in schemes might be eliminated. 8.327 The Committee found this situation quite amazing where NYKS were expected to provide additional services to different Ministries at the national plane and yet there was an attempt to reduce their number, leave aside expanding them in remaining Districts of the country. Even filling up of 97 vacancies was not being allowed. The Committee was of the view that in the context of number of schemes relating to education, health, rural development, women and child Development, HIV/AIDS, etc. being supported by the Union Government, the role of NY Kendras assumed special significance. The NYKS network could be used for monitoring, getting feedback, awareness generation etc. NYKS network extended upto village levels, in fact, had proved to be quite useful. In view of this, the Committee felt that while allocating funds for this scheme, only money aspect was kept in mind, and not the utility of it. The Committee, therefore, called upon the Ministry of Finance to clear the proposal of the Ministry for not only filling up the 97 vacancies of Youth Coordinators but also for opening Kendras in remaining districts in the country and allocate adequate funds at appropriate stage. This scheme needed to be strengthened as an instrument for channelising the youth power to constructive activities. 8.328 The Committee also suggested that Department should make every possible efforts to clear the confusion/uncertainties in respect of recruitment test that was held for selecting Youth Coordinators. 8.329 In view of this, the Committee emphasized the need for involving people's representatives of the area in an effective and formal manner. Members of Parliament might also be suitably associated with a view to imparting regularity in holding meetings etc. to review the activities of the NY Kendras and receiving guidance from them. 8.330 The Committee also impressed upon the Planning Commission to provide support for having some officers at the regional level who would be able to monitor as well as coordinate the activities of the NY Kendras in those regions. 8.331 The Committee was happy to note that the physical and financial performance of the NSS during 2002-03, 2003-04 and 2004-05 have been satisfactory. It, however, needed to be still improved, specially, the trend of utilisation in 2004-05. Although BE allocation of Rs. 28.00 crore was enhanced to Rs. 33.50 crore, actual expenditure figures upto 28.2.05 was only Rs. 23.25 crores, which was even less than the BE provision.

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8.332 There might be only a marginal increase in the utilisaiton position, if expenditure in NE States was also taken into account. A glance at following table revealed a different picture. The Committee noted that a large number of universities/colleges /schools were yet to be covered by NSS. 8.333 The Committee noted that there was a large gap between the existing universities, colleges, etc. and those in which NSS units have been provided. For example, 79 universities, 9683 colleges, 33,210 schools and 2031 technical institutions were yet to be provided with NSS units. In States like Andhra Pradesh, Bihar and Jharkhand, scheme seemed to have been implemented half-heartedly. The Committee further noted that States like Mizoram, Nagaland and Tripura were also not performing well, whereas other States like Tamil Nadu, Maharashtra and Kerala were doing exceedingly well. The Committee would like to describe the implementation of this scheme as lop-sided. In such a scenario, the Committee felt that it would be difficult to achieve the goal of providing NSS to all the universities, colleges and other educational institutions in the country, let alone expanding it to all the secondary schools as well. 8.334 The NSS have played a good role in the field of mass literacy, environment protection, health education, community development, drive against social evils, etc. The Committee wished to place on record its appreciation for the NSS volunteers who have always come into the forefront to extend voluntary services particularly in natural calamities like drought, flood, cyclone, earthquake and Tsunami tragedy. It was heartening to note that more than 6,000 NSS volunteers of 110 institutions from 10 universities were deployed in 16 districts and 2 UTs of Andaman and Nicobar Islands affected by Tsunami for carrying out relief and rehabilitation activities. 8.335 The Committee would also like the Ministry to review system of release of funds for implementing the NSS scheme. It would be appropriate if the institutions get the 1st instalment of the amount by the month of May for the implementation of the scheme without delay. 8.336 In view of the significance and popularity of the NSS, which was basically meant for preparing our students for self-development as well as community development, the Committee strongly recommended to provide adequate funds at appropriate stage for expanding/strengthening this scheme so that it covered the remaining educational institutions as well as expanding it upto 9th class. 8.337 The Committee believed that a large number of students at senior secondary level did not join NSS in view of the huge curricular load including that of competitive exams that they were forced to take up at 10+2 stage. This trend was increasing day-by-day, as a result, a large number of such students were not able to join NSS. The Committee, therefore, felt that Ministry, CBSE, NCERT and the Department of Secondary and Higher Education should put their head together for finding out ways to enable such students for participating in NSS activities. 8.338 The Committee also felt that regular monitoring mechanism for NSS activities at different levels was not there. The Ministry depended on reports and review from the Regional Directors of NSS who got reports from State Liaison Officers - employees of the States. Such a channel, the Committee felt, might not be free from biases etc. in reporting the feedback about impact and outreach of the programme. The Committee, therefore, recommended that a more independent/dependable mechanism should be provided for this purpose. 8.339 The Committee felt that number of training and research centres were inadequate for the entire country. Even the existing training and research centers were not functioning properly. The Committee, therefore, recommended that the training aspect of this scheme must be strengthened and their number also must be increased and to ensure that there was no gap in providing training to NSS functionaries. 8.340 Evaluation of this scheme was got done by the Ministry with the help of the IIPA. The Committee would like to know the steps proposed to be initiated in the light of the findings of the IIPA report. 8.341 The Committee was, no doubt, aware of this perennial problem of undue delay in settlement of accounts by the States in implementing Central sector schemes. It was the main bottleneck in implementing them. It further felt that this problem is projected more often than not as insurmountable. Similarly, the problem of State Liaison Cell not functioning in some States and UTs also fell in the same category. The Committee was of the opinion that the Ministry should take up these two problems with the concerned States at the highest level with a view to sort out the same and report the action taken in this regard to the Committee.

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8.342 The Committee observed that due to inadequate budgetary provisions, the Central Government have never been able to bear the liability to full extent which, over the years, have continued to grow upto about Rs.300 crores. 8.343 Obviously, the Ministry would not be in a position to meet even the annual liability under the Scheme, not to speak of the accumulated liability. 8.344 The Committee observed that more than 30 years have passed since the transfer of the Scheme to the States in 1972. Central Govt. have been simply releasing funds to various State Governments without having any idea about the annual as well as the accumulated liability to be paid to States. This was indeed a very strange situation. The Committee wondered about the status of 6145 NDS Instructors whose services were transferred in 1972. At that point of time also, many of them must have already rendered some service. After passage of more than 30 years, quite a few of them must have crossed the retirement age by now and some of them might have joined some other profession. 8.345 It appeared very surprising to the Committee that the Ministry have not made a serious attempt even to assess the exact amount of liability (State-wise) so far. The Committee strongly felt that there was an urgent need for ascertaining the number of such Instructors, State-wise. The Committee was of the considered view that a complete assessment about the status of NDS Instructors might be made without any further delay to settle their cases. The Committee would like to be apprised about the same. 8.346 The Committee found the idea behind the scheme laudable. The Nehru Yuva Sathees, the Committee hoped, would act as catalysts of change and would help in empowering Youth across the country. The Committee underlined the need for proper training to mobilize youth and in motivating them to participate in programmes for youth and community development. A proper monitoring mechanism, the Committee felt, would be required to be put in place to ensure effective implementation of the scheme. Transparency in selection of the Yuva Sathees must also be ensured. The main criteria for selection might be the social commitment of the candidates. The Committee expressed its doubt about the efficacy of 10-20 Sathees in a district as well as adequacy of Rs. 1000/- per month honorarium for them. 8.347 The Committee noted that this scheme have taken the place of erstwhile National Reconstruction Corps Scheme, which continued upto March, 2003. It have taken two years in formulation of the revised scheme. The Committee hoped that this scheme would not suffer from the shortcomings experienced in the implementation of the earlier scheme. 8.348 The Committee found the idea behind the scheme to be very good. The Committee, however, observed that despite satisfactory financial performance, the expanse of the scheme was too small to be felt at the national level. Just 150 camps every year for our youth (15-35 years) which constituted around 40% of our total population, were not adequate enough. There was apparent need for holding more and more such camps for which Ministry would have to be given additional funds at the RE stage. A permanent site might be identified for conducting the camps on regular intervals in each State. 8.349 The Committee found no physical targets fixed for this scheme. It reflected lack of desired enthusiasm in the Ministry about this scheme which was meant basically for promoting national integration. It, therefore, recommended that targets must be fixed every year for holding camps and exchange programme etc. 8.350 The Committee recommended that the institutions assigned the job of the assessment should be asked to adhere to a time frame in submitting their reports. The Committee would also like to be apprised of the outcome of the assessment alongwith the action taken by the Ministry thereon. 8.351 The Committee was informed that there were 65 hostels and 25 others were under different stages of construction. The Committee was dismayed that approval for construction of most of these Youth Hostels dates back to 1986 to 1994. These were still not complete even after two decades. Against an approved outlay of Rs. 22.99 crores for their construction, Rs. 8.41 crores had been released so far to various State Governments. In most of the cases, just one to two instalments have been released to State Governments. There were also cases where land is yet to be allotted. The reason given for this state of affairs were: (i) non handing-over of the fully developed piece of land by the State Government to the construction agencies; and (ii) non-submission of preliminary estimates and drawings by the State Governments for approval.

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8.352 The Committee was astonished to see the fate of this scheme. Delays of twenty to twenty five years in getting the Hostels constructed was simply unbelievable. The Committee was not satisfied by the explanation given by the Ministry that in case the required details in respect of hostels were not received within the specified period, the approval of yet to be started hostels would be cancelled and the grant already released would be recovered. The Committee felt that this proposed line of action is too late. It appeared to the Committee that Ministry have left everything to the States. It showed lack of regular monitoring of this scheme resulting in such a huge backlog. The Committee, therefore, recommended that this matter be taken up at the level of Minister/Chief Secretaries for expediting the construction of Hostels. The Committee would like to be apprised of the actions taken in this regard within three months. 8.353 The Committee noted that allocation for this scheme have been nearly doubled in 2005-06 and hoped that entire amount would be utilised for achieving targets of setting up 500 each YDCs and RITYDCs. The Committee recommended that the proposed RITYCDS and YDCs should be proportionately distributed so as to cover all the regions of the country.

8.354 The Committee noted that vocational training was one of the components of the scheme. In view of the number of youth being unemployed due to diminishing job opportunities, it was advisable that more and more vocational training programmes aimed towards gainful employment be designed. These training programmes would go a long way in channelising the hidden potential and energies of the youth towards constructive work. And at the same time, it would also prevent migration of rural youth to cities where they were forced to live a sub-human life apart from falling victims of anti-social elements.

8.355 The Committee observed that against an allocation of Rs. 17.84 crores under the Scheme during the Ninth Plan, utilisation figures amounted to Rs. 21.68 crores. During the first three years of Tenth Plan also, there have been optimum utilisation of allocated funds which have already reached the utilisation level of Ninth Plan. The Committee also noted that against targetted 80,975 youths, 1,26,019 youth were covered under this scheme during the Ninth Plan. Position must be similar during the Tenth Plan period also. The committee, however, was surprised to note that main implementing agencies of this scheme seemed to be NGOs as indicated in the details of financial releases made thereunder. The Committee failed to understand the reluctance on the part of the other proposed implementing agencies. The Committee strongly felt that an assessment about this aspect alongwith the impact of this scheme on the targetted beneficiaries and also effectiveness of monitoring mechanism need to be taken up by the Department at the earliest. 8.356 The Committee appreciated the move of the Ministry for setting up a Special Cell for Adolescent Youth and the project titled support to Adolescent Health and Development (2004-07) as part of UNFPA's Sixth Country Programme. The Committee noteed that 82 District Counselling and career guidance centres have been sanctioned under the scheme, which was targeted towards adolescents. A number of projects amounting to Rs. 7.00 crores have been sanctioned during the year 2004-05. The list provided by the Ministry indicateed that all the States were not covered under the scheme and the distribution was also not even region-wise. The Committee understood that the responsibility for monitoring have to be shouldered again by District Collectors. The Committee opined that the DC would not be able to spare much time to oversee the working of the agencies as he was already overburdened with tremendous responsibilities. The Committee, therefore, recommended that some other officer like District Education Officer or District Youth Officer might monitor this scheme so that it could be implemented effectively and benefits reached to the targeted groups. 8.357 The Committee was apprehensive whether all precautions had been taken while sanctioning a large number of projects in such a short period. The poor utilization of funds in previous years reflected the lack of priority for this scheme. 8.358 The Committee observed that during 2005-06, which was the fourth year of the Tenth Plan, a token provision of Rs. 1 lakh have been made. This clearly indicated that this scheme would continue to be in the formulation stage by the end of Tenth Plan period. The committee reiterated that prior to launching of any new scheme, all procedural formalities should be completed. 8.259 The Committee observed that the Scheme of Financial Assistance for Promotion of Youth Activities and Training have three components-Vocational Training, Entrepreneurship Development and Exhibition. Under the Vocational Training component, vocational training was provided to rural youth to prevent their migration to cities. The Committee found that one of the regular programmes run by NYKS was also

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Vocational Training. Rs. 30,000 per Kendra is earmarked every year for this activity. Similarly, under the scheme of Financial Assistance to Rural Youth Clubs/Sports Clubs, financial assistance was provided to Youth Clubs, @ Rs. 10,000/- per Youth Club for normal areas and Rs. 15000/- per Youth Club for tribal areas. NYKS also provided assistance of Rs. 7810/- per Youth Club Development Programme.

8.360 Scheme of Establishment of National/State Youth Centres provided a platform to the youth for organizing activities like Youth Parliament, National/State Youth Festivals etc. NYKS also ran some special programmes like National Youth Parliament of HIV/AIDS. 8.361 The Committee observed that there was a need for review of components of all the Youth related schemes to ensure that element of overlapping between two schemes was eliminated. A composite scheme administered by designated authorities would lead to better results. The Committee, therefore, recommended that the Department might initiate this exercise at the earliest.

8.362 The Committee found the amounts given to the NGOs under different schemes mind-boggling, for which utilization certificates were pending from 2001-02 onwards. The Committee was more concerned about the fact that the entire amount seemed to have been wasted. Recovering these amounts appeared to be impossible as most of the erring NGOs changed their addresses and got the money in different name next year. The Ministry did not take any action against defaulting NGOs except, not releasing further grants to them. This have led to a strange situation. The Committee felt that this situation must be remedied immediately. The Ministry should proceed legally against the defaulting NGOs and strengthen its monitoring mechanism carefully. While selecting NGOs, State Governments and District Collectors should also play a major role. The District Collector, being the key officer in a district having enormous manpower and authority, could play a very effective role in keeping an eye on the working of the NGOs. He might be asked to prepare a list of NGOs having a good track record of at least three years of working. The Ministry might give grants to only those NGOs who were in that list. As and when, a new NGO qualifies; it might also be put into that list. Besides, we might also utilize NYKS and NSS officers for verifying and getting feedback about NGOs. 8.363 Only 50 per cent of money should be given to the NGOs in the first instance, rest 50% could be given after they submit necessary papers and report was received from the office of the District Collector. The Ministry should ensure that good NGOs should not be harassed and money should come to them smoothly so that work did not suffer. 8.364 The procedure of applying to get grants by the NGOs appeared to be quite complicated. As a result, lot of persons worked as facilitators who did all the procedure for some money. In the process some of the NGOs coming from rural and remote areas got fleeced by middlemen. This problem, the Committee felt, might be overcome by making the entire procedure more simple and transparent. Lack of awareness about different schemes to be done by the NGOs also created problem for them as many a times, they have to run from pillar to post to find out about such schemes. The Ministry must ensure that wide publicity was given to such scheme at the district level through various channels. 8.365 The Committee had in the past expressed serious concern over non-submission of Utilisation Certificates by a very large number of NGOs given financial assistance under various schemes. Yet, there was a long list of such NGOs having Government funds lying with them from 2001-02 onwards. The Committee underlined an urgent need for having an element of accountability at every level – Centre/State/district to ensure proper and effective implementation of various schemes. The Committee, therefore, recommended to devise a fool-proof mechanism for selection as well as monitoring of activities of the NGOs. Efforts should also be made to avoid concentration of many NGOs in one particular district in view of an equitable distribution of benefits of this scheme. 8.366 The Committee would like to have details of the latest position obtaining in this regard and also the initiatives being undertaken to complete the pending works. 8.367 The Committee would like to remind the Ministry about its last years observations on the issue of under utilisation of funds. The Ministry in its action taken note had informed that SAI have been instructed to ensure the optimum utilisation of funds under its various Plan Schemes. Unfortunately the status of utilization did not show any improvement in 2004-05 either. The Committee, therefore, reiterated its earlier recommendation and would like the Ministry to adopt stringent fiscal measures and guidelines for

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streamlining its funding pattern. SAI should be asked by the Ministry to strictly adhere to those guidelines in utilizing allocations appropriately. 8.368 The Committee appreciated the constraints of SAI in getting its construction projects implemented by other agencies both in Delhi and the States. SAI would do better to ensure that all the construction works were completed in a stipulated time frame. Some methodology needed to be evolved to overcome this recurring phenomena of under utilisation of funds primarily due to delay in the construction works being executed by the agencies like CPWD, NDMC and DDA. 8.369 The Committee was given to understand that a proposal for transfer of internal revenue generated by SAI to a Corpus Fund was presently pending before the Ministry. The Committee would like to be informed about the initiatives/steps being undertaken by the Ministry to expedite the proposal and the outcome thereof. 8.370 The Committee noted that four new SAI sub-Centres which have been sanctioned at different places in the country were yet to be opened or fully operationalised. The Ministry should take up the matter with the State Governments for removal of bottlenecks in setting up/operationalising of these sub-centres without any further delay. The SAI centres/sub-centres should be opened preferably in those States, which have shown commendable performance in the national as well as international events. 8.371 The Committee desired to express its reservation about selecting Navodaya Vidyalayas for this scheme under which lot of support was provided for creating infrastructure for training etc. of the budding sportspersons. Because the students coming to Navodaya Vidyalayas were selected through open competition who were committed mainly to the regular studies; sports might not be priority for them. Secondly, these schools being purely residential, students from other neighboring schools might not be able to use the facilities provided there. The Committee felt, emphasis of the Ministry while opening the NST Centres, should be to the normal schools particularly in the rural areas where the infrastructure could be used in a better way. 8.372 The Committee hoped that the report of Task Force would be submitted in time so that the action in this regard was initiated timely. The Committee recommended that the Ministry should be provided adequate fund at RE stage so that the works pertaining to Commonwealth Games, 2010 were not delayed. A plan should be chalked for phase-wise development of the infrastructure and the money be spent judiciously. The Committee felt that efforts should be made to build proper infrastructure in time-bound manner with a view to avoiding last minute pressure of work.

8.373 While creating infrastructure for the Commonwealth Games, we should not ignore preparation/training of our sportspersons. This should be treated as an opportunity to enhance our nation's prestige by winning more and more medals. Selection and training of prospective participants must take place now so that they get enough time to prepare themselves.

8.374 The Committee felt that hosting 2010 Commonwealth Games was a privilege accompanied with a lot of responsibility. It was understood that more than 600 crores of rupees would be required to set up Commonwealth Games Village. Funding would, therefore, be totally based on a well-planned need based approach. An amount as big as Rs. 600 crores of rupees approximately could leave huge deficit after the Games were over. The Committee felt that the Government should have a way out for utilizing the facilities and infrastructure after the Games were over, so that the project would not block Government money from other pressing matters. We have, therefore, to remain highly alert in the use of infrastructure after the games. The Committee hoped that the planners would seriously study the funding pattern in the light of the experiences gained from other countries who have hosted such games in the past. 8.375 The Committee noted that India’s performance in international sports was not at all commensurate with the size of our country as well as the population. The Committee wanted to cite the example of People's Republic of China in this regard. If China could do, there was no reason why India could not. 8.376 The Committee was of the opinion that unless all those responsible for promoting sports, particularly, the Ministry, the SAI, the State Governments, Sports Federations/Associations took it up as a challenge and work in tandem with each other, a visible impact could not be made. The present tendency of shifting responsibility on one another have to be stopped. We should have to work in a time-bound manner with the dynamic categorization of sports disciplines, transparent selection procedure, country-wide talent hunting,

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modern training facilities, etc. The Committee in this regard would like to mention about “Operation Gold” Scheme launched by the Kerala Sports Council in which district panchayats have been involved in talent search from the local level. The Committee felt that this scheme could be applied at the national level also. 8.377 The Committee observed that during the Ninth Plan these five schemes were operating independently. During the first two years of Tenth Plan also these schemes continued their independent status. Performance of two schemes, Sports Scholarship Scheme and Pension to Meritorious Sportspersons seemed to be satisfactory as there was optimum utilization of funds allocated therefor. However, position was different in respect of the other three schemes, namely Rural Sports Programme, National Sports Development Fund and Promotion of Sports and Games in Schools. Funds provided for these Schemes remained unutilized/under utilized. The Committee was constrained to note that convergences of these five Schemes into one umbrella scheme in 2004-05 failed to improve their performance level. 8.378 The Committee would like to be apprised about any assessment made so far about the impact of active participation of Bihar in this programme and non-inclination of participation by other States. The Committee would also like to know about the role of NGOs in holding of these tournaments in different States during this period. The Committee have been given to understand that for holding national level tournaments under this programme, SAI was given a grant of Rs. 2,50,000/- per discipline in various States by rotation. The Committee would like to be apprised about the various national tournaments organized by SAI during the Tenth Plan so far (State-wise). 8.379 This lower utilization of funds, the Committee felt, was mainly due to non-release of a large amount under one of its components i.e. Pension for Meritorious Sport Persons. The Committee noted that these four schemes were very crucial for nurturing sports talent in our country. They have, however, suffered lesser allocation of funds in 2004-2005. The only exceptions have been the scheme for pension for meritorious persons. However, here also, out of Rs. 17 crores provided for this component in RE 2004-05, only Rs. 1.25 crores could be utilized. The Committee felt that the merged scheme was one of the main schemes of the Ministry encompassing important components in it such as Promoting Rural Sports, Sports and Games in schools as well as providing Sports Scholarships, Pension for Meritorious Sportspersons and Sports Development Fund. The performance of this scheme as a whole did not inspire enough confidence. The Committee would like to point out that all these components have been in existence as independent schemes for quite a few years. There were inherent shortcoming in their earlier forms. Mere merger of these schemes would not succeed in eliminating those shortcomings. What was needed was a proactive role to be played by SAI/Department in regular co-ordination with State Government/implementing agencies. The Committee was of the opinion that components like Rural Sports Programme, Promotion of Games and Sports in Schools and Sports Scholarships needed more focus. The Committee also felt that the allocation for the scheme was not commensurate with its importance and that also needed to be suitably enhanced. 8.380 The Committee expressed its displeasure at the manner in which the scheme meant for disabled persons was being handled. It reflected our insensitivity towards them who needed special support and motivation to enable them to join the mainstream. The Committee, therefore, recommended that this scheme should be finalised for implementation from this year itself. There were different words in vogue now-a-days for such persons. The Committee felt that name of the scheme should be suitably changed.

8.381 The Committee noted that four schemes relating to creation of sports infrastructure have been transferred to the State/UTs governments since 1st April, 2005. This, according to the Committee, amounted to virtually abandoning all these schemes. Due to financial constraints, currently the States/UTs governments were not in a position to provide their share towards the cost of projects already approved. As a result, 508 projects were lying pending for completion involving financial liability of around Rs. 160 crores on the Central Government. Keeping in mind the financial constraints of the States, the Committee was of the firm opinion that it would not be possible for the States to fully fund the sports infrastructure projects. The Committee failed to understand how this financial liability would be taken care of. 8.382 Our country suffered from massive lack of infrastructure facilities for sports, which needed to be taken up seriously. This activity being highly cost intensive, the Committee was sure, it would be difficult for the States to undertake this work. Adequate infrastructure at the ground level was a must for broad-basing the sports as well as achieving excellence. The scheme of providing infrastructure in rural schools, which was a part of NCMP of the Government, would also remain on papers only. The Committee was informed that the Department have also taken up the issue with the Ministry of Finance as well as Planning Commission but with no avail. In view of above, the Committee called upon the Planning Commission and the Ministry of

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Finance to review the decision of transferring infrastructure schemes to the States and allow these to be retained with the Ministry only.

8.383 The Committee found that the scheme have failed to take off and further strengthening / expansion of the scheme was now being contemplated. The Committee was not happy to note this development. Some preparatory exercise must have been undertaken by the Department prior to launching of this scheme. Funds were also procured for implementation of the same. However, three years have passed since then, and in the fourth year exercise of review/revision of the scheme have started. By the time this exercise was over, another year would pass and Tenth Plan would also reach its last year. Final outcome would be nil. The Committee reiterated that a new scheme should be announced only after extensive work study and planning and review of anticipated shortcomings and constraints. ) 8.384 The Committee was informed that many NSFs were not submitting their accounts regularly and were also not regular in holding championships at different levels, which they were supposed to do. It was said that the working of NSFs needed to be further streamlined. The Committee, while respecting their autonomy, felt that the NSFs should themselves evolve some norms/guidelines for imposing self-discipline amongst them with a view to bringing more transparency and accountability in their working. If it was done, the erring NSFs would thus be identified and isolated, who brought all the NSFs in bad repute. 8.385 The Committee would like to be apprised of the amounts due, federation-wise, as also the steps being taken by the Ministry to settle these dues. 8.386 Although the Ministry promised about 100 per cent expenditure by the end of this financial year, the utilisation of the funds during the 1st three years of the Tenth Plan, presented a dismal financial performance in case of the NE States. 8.387 The Committee was happy to note that pursuant to the recommendation made by this Committee in its last year's report, a separate unit named North Eastern States Cell under Director (sports) have been set up in the Ministry. The Committee hoped the Cell in the Ministry would ensure the judicious and proper use of funds for development of youth and promotion of sports in these States. The Committee was of the opinion that this work should be the sole responsibility of the Cell, not merely an additional responsibility. 8.388 The Committee was surprised to note that a final decision was yet to be taken as the matter still remained under consideration in consultation with the Ministry of HRD. The Committee failed to understand the constraints in taking a decision on this issue of setting or not setting up of the All India Council of Physical Education. The Committee strongly felt that this issue must be settled at the earliest. (j) 166th Report

8.389 The Committee was of the opinion that the model for gender based analysis of the Union Budget developed by NIPFP in 2001-2002, needed to be refined with a view to making it more precise and wider in scope. This model was not able to provide adequate insight in the case of mainstream budgets. The Committee, therefore, recommended that steps be taken to examine the same and a methodology evolved on this aspect at the earliest. 8.390 The Committee did not expect such a cryptic reply by the Department to a specific question. It was good that the chapter on Gender Budgeting have since been reintroduced in its Annual Report after the Committee pointed it out. The Department should have provided reasons for not doing so earlier, which have not been done. 8.391 The Committee expressed its satisfaction over reflection of Gender-budgeting in the Annual Budget since the presentation of its 153rd Report to the Parliament on 21st December, 2004. Only exception was the two instructions issued by the Ministry of Finance on 24th December, 2004. First being to all Departments/Ministries to establish a ‘Gender Budgeting cell’. The Committee was happy to note that all Departments/Ministries have been instructed to establish a Gender Budgeting Cell by 1st January 2005. The Committee only hoped that Gender Budgeting cells must have been set up and made fully functional by now in all Departments/Ministries. Ideal position would have been if the Department had ensured that this directive of the Ministry of Finance had been complied with by each and every Department.

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8.392 The second directive was meant for eighteen selected Departments/Ministries to bring out scheme-wise provisions and physical targets benefiting women in their Annual Reports/Performance Budgets for 2004-05 alongwith their Detailed Demands for Grants 2005-06. The Committee was disturbed to note that virtually no progress has been made in this regard inspite of Department pursuing the same since October, 2004. A test check made by the Committee of some Ministries/Departments out of the selected 18 ones did not reveal a happy scenario. Annual Reports (2004-05) of Ministries/Departments like Department of Elementary Education and Literacy, Department of Secondary and Higher Education, Ministry of Labour and Employment, Ministry of Small Scale Industries, Department of Environment and Forest and Ministry of Home Affairs did not have any chapter on Gender Budget Analysis. There was only a brief mention in this regard in the Annual Reports of the Ministry of Health and Family Welfare & Ministry of Youth Affairs and Sports. 8.393 The Committee, therefore, recommended that the Department as a nodal agency must ensure that all the instructions related to gender budgeting issued by the Ministry of Finance on 24th December 2004 were carried out in a time bound manner. There was need for an effective interdepartmental coordination to achieve the objectives of gender budgeting in the true sense. 8.394 The Committee noted the efforts made by the Department in association with the Ministry of Finance for developing the model for analysing public expenditure. However, the aspects of developing methodologies, gender tools and research activities in different areas of gender budgeting still left much to be desired. The Committee recommended that the Department should frame guidelines for the purpose within a stipulated timeframe. The guidelines should be uniform and the procedure followed should facilitate proper assessment of the impact of gender budgeting. 8.395 The Committee recommended that necessary measures should be undertaken to expedite the development of focused resource module for training all the officials who were directly/indirectly connected with the work. 8.396 The Committee appreciated the efforts made to sensitize/involve the private sector in the exercise of gender budgeting. However, it felt that time bound action plan was the need of the hour. The Committee felt that the Department ought to have taken up the matter with the numerous other Trade/Industry Organisations in the country. The Committee, therefore, recommended that the Ministry should take up the matter with all the major Industry Organisations. Follow up actions would further ensure that gender-sensitisation was getting the full attention of the private sector. Involvement of industry federations/organisations through national level seminars/conferences would provide the opportunities for regular interactions on gender sensitization in private sector. (k) 168th Report 8.397 The Committee’s concern contained in para 2.5 was simply to highlight the plight of the States who did not get further funds on the ground of non-furnishing of the utilization certificates. As a result, implementation of a scheme suffered. The Committee desired to draw attention to this perennial problem, which caused chain reaction leading to poor implementation of the schemes. 8.398 The Committee recommended that the Department took up the issue with the Ministry of Finance to suitably revise GFR provisions to facilitate the release of first installment in April itself and allow the States to submit utilization certificates within a reasonable time and, if they were able to spend 25% of the installment in that quarter, the further installments might be released. 8.399 The Committee noted the action taken by the Department to identify some schemes and devise strategies for their effective implementation. Departments reply, however, did not contain reasons for its inability to fully utilize the funds in respect of the central organizations and schemes like that of the NCERT, ICT, Access and Equity and Quality Improvement in schools. The Committee felt that the above-mentioned organizations and schemes were very crucial for an efficient human resources development and it desired that the Department undertook all steps to properly implement the schemes. The Committee expected the Department to furnish pointed replies to its recommendations/observations. 8.400 Further, the Committee was dismayed to note that funds for the Technical Education Quality Improvement Programme could not be released due to time consuming process adopted by the Evaluation

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Committee and the Selection Committee. The Committee was surprised to note that the funds under the programme could be released only at the fag end of the financial year, i.e. on 4th March, 2005. The Committee strongly recommends that the Department should streamline the procedure, so that it became result oriented and pragmatic.

8.401 Reply to this recommendation was distinctly evasive. Department have conveniently chosen not to comment about Committee’s observation regarding underutilization/re-appropriation of funds relating to polytechnics which were primarily meant for students belonging to poor and middle class sections of the society; details about which have not been provided. Such non-utilization would defeat the purpose and spirit of Common Minimum Programme.

8.402 The Committee observed that there was a wide gap between the targets set for sanction of new JNVs during the first three years of Tenth Plan. Out of 101 new JNVs proposed to be sanctioned, only 43 could be sanctioned during the first three years of Tenth Plan, and out of 120 JNVs targeted to be completed, only 38 could be completed during this period. The Committee have little hope for achievement of Tenth Plan target during the remaining two years of the Plan period. Response of the Department also indicated that they also did not expect the required funds. The Committee was, however, not happy with this state of affairs and strongly felt that the Department have failed to project its requirements before the Ministry of Finance. 8.403 The Committee desired that the Samiti should take up the matter vigorously with the concerned funding agencies and ensure that required funds were given to meet the targets fixed. At the same time the Committee would also like to emphasize that the Department should continue to actively pursue the concerned State Governments and construction agencies for the immediate clearance/construction of projects.

8.404 The Committee desired that the ceilings of the budget allocated for National Institute of Open Schooling should be fixed in such a manner that its objective of providing continuing education did not get diluted due to paucity of funds. Implementation of the National Institute of Open Schooling and the quality of education imparted through it may be regularly monitored. 8.405 The Committee felt that frequent revision of schemes needed to be avoided. It reflected that the formulation of the scheme itself was flawed. The Committee was dismayed to note that even after the revision and approval by the competent authority on 15th December, 2004 the ICT in Schools scheme witnessed underutilization of funds during 2004-05. The Committee hoped that such tendency would not be recurring in future. 8.406 The Committee appreciated that the Department’s will to fully utilize the budget of Rs. 50.00 crores allocated for the ICT in Schools Scheme. However, the Committee was surprised to note that it took almost two years to send a Cabinet Note for approval of the ICT in Schools Scheme to CCEA after getting approval from the HRD Minister and holding inter-Ministerial consultations. The Committee was happy to see that later on the procedure was expedited in few months. The Committee hoped that the Department would continue to be proactive and efficient in discharging its duties. The Committee hoped that such tendency would not be recurring in future. 8.407 The Committee noted that while there was a progressive increase in the funds allocation to NGOs, there was a noticeable decline in funds earmarked for the states especially, for the year 2004-05 for carrying out the implementation of the IEDC Scheme. The Committee underlined the need of strong participation of the state in the scheme because they have the necessary resources in terms of data, manpower, etc. to carry out such a scheme effectively. The Committee hoped that states’ participation would be strengthened in the new scheme proposed in the 11th Plan. 8.408 The Committee was not happy with the reply of the Department that the Ministry was issuing the reminder/instructions to the State Governments. The Committee was aware of the workload of the District Magistrates and at times they might not be able to personally inspect the hostels. It was in this backdrop that the Committee recommended that if the District Magistrates were not available, some other Officer might be authorized to inspect the hostels on his behalf. The Committee, therefore, reiterated that a Senior Officer might be authorized for carrying out the required inspections. This issue could be discussed and sorted out at the higher level at the earliest.

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8.409 The Committee did not agree with the explanations given by the Department for not allowing the students to appear for board examination in their own schools with supervisors/invigilators from different schools. The Committee have learnt that this was being done in areas where single CBSE schools were existing and the students were allowed to take-up examination in their own school. The Committee felt that this proposal needed further consideration.

8.410 The Committee noted that the Department have not commented on the action- taken against the fake institutions. The Committee would like to recommend that the matter might be pursued with a view to ensure that that fake institutions were not allowed to cheat the public. It appeared to the Committee that there was no specific law to deal with fake institutions. If it was so necessary legal mechanism needed to be put in place at the earliest for prosecuting such fake institutions. Simultaneously, adequate publicity about the fake institutions might be made.

8.411 The Committee found that the Department have chosen to give a vague reply to a specific question. 8.412 The Committee reiterated its earlier recommendations that it would like to have a clarification in this regard. 8.413 The Committee was of the opinion that increase in the amount of scholarship always helped the needy and poor students but this should not be a justification to reduce the number of scholarships. The Committee, therefore, reiterated its earlier recommendations that the number of scholarships and the total outlay of the scheme might be substantially increased progressively, so that more and more needy students were benefited.

8.414 The Department have informed that the matter of appointing National Professors was under consideration since March 2005. It would like to know the reasons for the delay and the present status of the appointment process. The Committee would like the Department to submit a statement showing the final action taken within one month of the presentation of this report.

(l) 169th Report 8.415 The Committee opined that Action Plan on the National Youth Policy 2003 was long overdue. It was surprising that the Action Plan was being chalked out two years after the announcement of the policy. The Action Plan should always follow immediately after the policy was announced. The Committee felt that with the reports from the Chairpersons of the eight sub-groups in hand, the Committee on Action Plan should be in a position to discuss these at the earliest so as to enable the Inter Sectoral Committee to expedite the Plan of Action within the extended period of time without fail. 8.416 The Committee was surprised to see that the Department have chosen not to respond to its observations about the strengthening of promotion of sports among disabled. The Committee reiterated its concern about lack of seriousness in implementing this scheme for the underprivileged class of the society. It appeared to the Committee that the scheme is existing on papers only. 8.417 As regards poor performance of Youth and Sports Schemes mentioned in its recommendations, the Committee found the same old problems like non-receipt of proposals/suitable proposals, delay in submitting UCs etc. extended again for slow implementation of Centrally Sponsored Schemes. The Committee would request the Ministry to supply a note on these issues hampering the progress of the schemes separately for its consideration. 8.418 Committee’s attention had been drawn by the low achievement level of physical targets under various programmes conducted by Nehru Yuva Kendra Sangathan during the year 2004-05. The Committee have now been given to understand that physical targets indicated the achievement made upto November, 2004. However, as on 31st March 2005, achievement figures touched 91% to 137%. The Committee would like to point out that as per the Performance Budget (2005-06) of the Ministry, achievement figures for various programmes of NYKS covered the period upto 31st December, 2004. Committee observed that as compared to the first three quarters, last quarter of the year 2004-05 must have been very hectic and eventful. All the activities, be it Awareness Generation Camps or Sports Promotion Programme or Seminars/Workshops or Work Camps, seemed to have been held in the last quarter only. The Committee would like to emphasize that all programmes should be evenly spread round the year. Only then it could be said that programmes were being implemented as per the prescribed norms. Committee would appreciate if the Ministry took remedial

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steps in this regard. The Committee was disappointed to note the very low level of female participation under this scheme. It, therefore, reiterated its earlier recommendation of raising the number of female beneficiaries upto the desired level by fixing the targets. 8.419 The Committee was happy to learn that after its recommendation, the Ministry’s proposal for filling up of existing vacancies as well as its demand for additional posts in NYKS have been reopened by the Ministry of Finance. The Committee felt that if the goal of universalisation of NYKS was to be achieved in real sense, the process of filling up/ creation of additional vacancies and also opening new Kendras could not be postponed any further. The Committee appreciated the limitations of Ministry of Youth Affairs and Sports in getting these proposals accepted. The Committee would like the Ministry to urgently place their proposal before the Committee of Secretaries as suggested by Ministry of Finance. There should not be any excuse for delay in that regard. 8.420 The Committee does not approve of the abolition of the posts of Regional Coordinators because it would certainly affect the monitoring of this scheme. Monitoring at the regional level was one of the important aspect of any Centrally Sponsored Scheme. The Committee, therefore, recommended strengthening of the monitoring mechanism at regional level. Elected representatives of various levels from Gram Panchayats upto MPs/MLAs might also be suitably associated for this purpose. 8.421 The Committee have been emphasising time and again that re-appropriation of funds was not at all a healthy trend.

8.422 NSS was a noble scheme aimed at the development of the personality of student youth through community service. The Committee reiterated its demand to expand this scheme in a big way and called upon the Ministry to plead this case with the Planning Commission effectively and expeditiously.

8.423 The Committee noted that the Ministry have not indicated any details regarding opening more NSS units in Universities /Colleges and plus 2 Councils. The Committee hoped that in the scheme submitted to the Planning Commission these things have been elaborated. After all the Ministry should have some targets for opening new NSS units in the coming years. The Committee hoped that such details would be reflected in Ministry’s document in future. 8.424 The Committee while appreciating the doubling of number of orientation and refresher courses for each TOC/ TORC, wished to underline the need to see that quality of training was not compromised in any measure. Increase of participants might affect the quality adversely. The Committee would like the Ministry to take up the issue with the Planning Commission for expeditious disposal of its proposal regarding increasing the number of TOCs & TORCs. 8.425 The Committee would like to reiterate its concern about the manner in which this problem was being allowed to acquire alarming proportions. The Committee, therefore, felt that this issue now required more serious and proactive approach than by merely writing letters to the State Governments. It would like the Ministry to take it up at the highest level in the State Government. 8.426 The Committee during its visit to J & K found that such camps have had strong impact on the youth who attended these camps held in parts of the country. They demanded such camps to be held at regular intervals frequently. 8.427 The Committee was surprised to note that even after the lapse of three years of Tenth Five year Plan, the Ministry’s initiative regarding the permanent sites for conducting camps in each State was still pending with the Planning Commission. The Committee hoped that the Planning Commission would also appreciate the need for permanent sites and expedite its approval on the project pending for its consideration. 8.428 The Committee was happy to be informed about the details of the targets fixed for conducting national integration camps. It would however, have been better had this statement reflected the budget earmarked for such camps on quarterly basis as well as the achievements of the targets in the first quarter. 8.429 It was surprising to note that Government had asked State Government of Manipur to ensure immediate start of the construction work of the project after releasing three instalments (total Rs.69 lakhs) for the Vishnupur, youth hostel. Intereastingly, the first instalment was released way back in March 2000. This, according to the Committee do not present a good picture. The Committee, no doubt was aware of the

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limitations of the Scheme, it however, believed that a noble scheme like this needed a more proactive & serious approach. The Committee felt that the process of releasing instalments for construction of youth hostels as well as the progress report of construction left much to be desired. This was evident from the details of seven Youth Hostels projects for which grants have been released during March to July, 2005.

8.430 Whatever may be the veracity of the progress report and the criteria of the release of instalments, the Committee observed that still no time frame for construction of the project was fixed by the sanctioning authority which indicated lack of effective monitoring. The Committee would like the Ministry to seriously review the whole scheme of things in consultation with the State Governments and the implementing agencies to avoid time and cost overruns. 8.431 The Committee expressed its unhappiness on the slipshod reply to its specific observations/recommendations on an important issue of large number of NGOs taking public money and not reporting back. The Committee would like to have the details of the amount released to the NGOs that failed to submit Utilisation Certificate during last three years. In fact, the names of defaulting NGOs should figure in public through print media and the Ministry’s website on Internet. 8.432 The Committee was also not satisfied with existing monitoring mechanism for the functioning of the NGOs. Simply inviting the representatives of NYKS and NSS in their programmes would not have the desired impact, although it might be a good idea. The Committee would like to emphasize that service of NYKS and NSS officers might be utilized for verifying and getting feedback about NGOs. The Committee would also like to reiterate that the District Collector, being the key officer in the District could play a very effective role in monitoring the functioning of NGOs. He might be actively involved in verifying the antecedents of NGOs active in his District. In fact, on the basis of the feedback received from NYKS and NSS officers the District Collector should be in a position not only to prepare a list of NGOs having a good record but also help in monitoring of their activities and such issues of Utilisation Certificates could be taken care of in a better way. 8.433 The Committee was of the view that the manner in which the outstanding Utilisation Certificates were being followed up over the years left much to be desired. For example, only one case of the outstanding UC for the year 2001-02 and 50 cases pertaining to 2002-03 could be settled. With the present level of monitoring the problem of outstanding UCs wouldl go from bad to worse with new additions in coming years. The Government needed to take urgent remedial measures to ensure settlement of pending UCs in a time bound schedule. The Ministry’s claim for regular monitoring of the status of outstanding UCs have not borne fruit. The Committee would also like to emphasize that efforts should be made to avoid concentration of many NGOs in one particular District. The Committee strongly felt that there was an urgent need for taking into account the number of NGOs already handling a particular programme in a District before inviting a new NGO. This aspect might be included in the eligibility criteria for NGOs. 8.434 The Ministry have not indicated the details of the new Quality Action Plan made for achievement of financial and physical targets. The details of initiatives undertaken were also missing. The Ministry’s assertion about likely completion of pending works and improvements in targets in the absence of detailed information was, therefore, not convincing. Present status in respect of various items of work in Hazaribagh and Lucknow have not been given in the annexure VII. Most part of the reply pertained to the works to be taken up in future rather then steps taken to complete the pending works. 8.435 The purpose of the Committee in highlighting the proposal for transfer of internal revenue generated by Sports Authority of India to a corpus fund was to emphasise on the urgency of its clearance by the Ministry. It appeared that the proposal was still shuttling between the Ministry and the Sports Authority of India. The Committee reiterated the urgency of such corpus fund to enable SAI to prioritize those schemes which need urgent financial needed. The Committee would like the Ministry to expedite the proposal without further delay. 8.436 The Committee expressed its concern at the poor progress in respect of the new SAI sub-centres. The Ministry have either not been able to impress upon the State Governments of Maharashtra and Tamil Nadu to expedite land allotment or the norms fixed for the purpose were coming in the way. In either case, the Committee would like the Ministry to seriously pursue for the expeditious disposal of other two sub-centres with the respective State Governments. It should in consultation with the State Government finally settle the outstanding issues.

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8.437 The Committee hoped that the crucial areas such as selection and training of sports persons for future games were also being adequately addressed. The Committee was happy to learn that the creation of infrastructure for the Commonwealth Games 2010 was being taken up in time bound manner. The Ministry have outlined the milestones of survey, concept plan, tender process and work completion ranging up to March 2010. The Committee however, observed that with regard to renovation of stadia, Action Plan simply mentioned the implementing agencies, i.e. SAI/DDA/NDMC and survey to be completed by August, 2005. The Committee would like to point out that our sportspersons need to be prepared/trained with world class training facilities to compete with other sporting countries. The Committee emphasized the need for adequate practice, training and exposure to our sportspersons in different events prior to Commonwealth Games 2010. For that, our existing stadia need to be made fully operational. The Committee, therefore, emphasized that this task should also be completed in a time bound manner. 8.438 The Committee expected precise replies to all the aspects pointed out in its recommendations/observations, which was missing here. The Committee have found the Ministry non-responsive to its queries about the working of National Federations. The Committee would like to have Ministry’s response about Kerala Scheme mentioned in its recommendation. A copy of the China model also be sent to the Committee for its consideration. The Committee hoped that the Ministry would practically liaise with all sports bodies and State Governments to move ahead with a pragmatic approach. 8.439 The Committee was not satisfied with the reply provided by the Ministry because it did not give reasons for not holding tournaments at Block, District and State level every year by various States. Committee would like to know the constraints being faced by the defaulting States in not organizing the tournaments at various levels for three consecutive years. The Committee would also appreciate if details of participation by Bihar in National level competitions during the last three years were made available to it. 8.440 The Committee was of the view that despite the Ministry’s initiatives being taken to improve the outreach and impact of the schemes relating to nurturing of sporting talents in the country, the performance level of this scheme was not at all satisfactory. The Committee, therefore, reiterated its earlier recommendation and stressed that the inherent shortcomings of the schemes needed to be rectified with strict supervision and effective monitoring by the SAI, State Governments/Union Territory administrations and others. 8.441 The Committee was quite amazed to learn that a special scheme for physically handicapped which was scheduled to be implemented in 2002-03, was still in the formulation stage. It was also not clear by when the scheme was going to be finally approved. The Committee emphasized upon the Ministry to formulate the scheme without much delay so that it could be implemented at the earliest. 8.442 The Committee was happy to note that the Planning Commission have given its approval for meeting the committed liabilities of incomplete sanctioned projects regarding sports infrastructure during the remaining period of Tenth Plan. The Committee, however, observed that this could only be considered a stop-gap arrangement. Problem of long pending sports infrastructure projects due to the undue delay in submission of utilization certificates by State Governments would still remain. The Committee strongly felt that for nurturing of sports talent at the grass root level, infrastructure projects need to be expedited. The Committee, therefore, recommended that a through view of these schemes should be undertaken by the Ministry without any further delay. 8.443 The Committee was constrained to note that despite recommendations being made in its earlier reports also on the issue of settling of outstanding dues towards rent of various stadia being occupied by different federations, the situation have remained unchanged. Moreover, the Ministry have failed to apprise the Committee about the steps being taken to settle these dues. This infact showed the lack of seriousness on the part of the Ministry in this regard. The Committee recommended that the Ministry should initiate action to remedy the situation and, apprised the Committee of the steps being taken against the erring federations. (Para 23.5)

(m) 170th Report 8.444 Keeping in view the non-utilisation of funds under both child and women related schemes as per the Annual Action Plan; the Committee had suggested that the Department should take up this issue with the State Governments. Detailed reply given by the Department confirmed the Committee’s apprehensions that structural and functional problems were mainly responsible for such a situation. Demand for additional funds

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of Rs. 100.00 crore for World Bank assisted ICDS-APER and ICDS-III projects made at the RE (2004-05) stage could be met only on 21.12.04. However, these available funds remained un-utilised due to another procedural formality, i.e. CCEA approval for extension of these projects, which was sought as late as on 24.3.05. Delay in submission of required documents by the implementing agencies have been cited as the major factor responsible for poor utilization of funds in respect of other schemes. The Committee reiterated that the Department should take up this matter with the State Governments, particularly with the States not performing well on an urgent basis. Simultaneously, the Department needed to take effective steps so that the process of required approval for fund-release and utilization thereof from the Central authorities was completed within the minimum possible time. 8.445 The Committee expressed its serious concern about the vicious circle that was developing in NE region regarding States not being able to spare their share in construction of AWCs. It was resulting in huge backlog and implementation of scheme was not taking off. A way out have to be found out in this regard urgently. 8.446 The Committee noted that the States have been requested to undertake a micro-level survey/planning and furnish location specific requirement of additional Anganwadi centres based on the revised population norms (as recommended by the Task Force) for second phase of expansion of ICDS Scheme. The Committee hoped that the revised population norms meet the specific requirement of States. However, the Committee doubted whether the State Governments would be able to undertake the work given the limited resources and infrastructure available with them. There was also no cut off date for receipt of the proposals in the Department and final decision taken in this regard. The Committee underlined the need of a time bound Action Plan as well in this regard. 8.447 The Committee appreciated the various initiatives taken by the Department for more effective implementation of ICDS scheme. The Committee however, was disturbed to note that recommendation of a Core Committee set up in April, 2003 to review the role and responsibilities of Anganwadi Workers and Helpers were yet to be finalized. It, however, seemed that no time frame have been fixed by the Department for evaluation and acceptance of the recommendations of the Core Committee. The Committee would like to emphasize that the recommendations of the Core Committee should be expedited by January 31, 2006. 8.448 The Committee desired that a note containing the recommendations of the Core Committee alongwith the evaluation of the Department thereof might be sent to the Committee. 8.449 The Committee have been given to understand that continuation/expansion of the Nutrition Programme for Adolescent Girls in 2006-07 depended upon the findings of an evaluation study. The Committee was, however, surprised to note that although, 2005-06 was nearing its end, the Department was yet to finalise an agency for the evaluation study. The Committee would like to impress upon the Department to expedite the completion of evaluation study without further delay. Only then desired goals under NPAG could be achieved. 8.450 Committee’s attention have been drawn towards a number of nutrition schemes being administered by other Departments. Committee had suggested that a Pilot Project for evaluation of all such interventions might be undertaken in one district of each states. The Committee however, found that no progress in this regard have been made so far. The Committee was of the view that all nutrition schemes meant for children/women being administered by different authorities both at Central and State level needed to be reviewed for better co-ordination and implementation. 8.451 The Committee appreciated that the Department have sanctioned drinking water and sanitation facilities for ICDS project. However, merely issuance of guidelines to the Department of Drinking and Water Supply might not be enough; a centralized monitoring of the Scheme would bring the desired result. The Committee found that the Department have not given any details to improve the situations in Uttar Pradesh, Bihar and Jammu & Kashmir and would like to be apprised about the steps taken with regard to these states. 8.452 The Committee would like to inform the Department of WCD that the MPLADS was administered by Ministry of Planning and Programme Implementation, which was the nodal Ministry. The Department was further informed that provision for construction of Anganwadi Centres was already there in the guidelines for the MPLADS Scheme.

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8.453 The Committee vide its recommendation in para 5.10 called upon the Department to apprise the Committee about the number of training programmes conducted by the NTPCCD and State Government/NGOs state-wise during 2003-2004 and 2004-05. However, the Department in their action taken note have not furnished details. This was not acceptable to the Committee. This was an example of poor implementation of the programmes. The Department should furnish the report as requested. The Committee recommended that immediate steps might be initiated to increase the number of training programmes and also apprised the Committee about the steps taken by the Department. 8.454 The Committee took note of the evaluation reports of the project UDISHA (2003-04) conducted in some selected States by NIPCCD. The Committee have been informed that concerned State Governments have been asked to chalk out their training plans based on the key findings and recommendations of the evaluation report. The Committee hoped that State training plans must have been modified in the light of constraints being faced by ICDS functionaries. 8.455 The Committee had expressed its apprehension about the concentration of the crèches in Andhra Pradesh, Madhya Pradesh and Maharashtra. However, no reply to this fact was provided. The Committee took serious note of it and reiterated that the Department should take cognizance of the fact and take remedial measure for proportionate distribution of crèches across all states of the country. 8.456 Committee was of the opinion that implementation of the scheme of NCF left much to be desired; its spread and number were miserably inadequate. Lack of assessment of crèches after they became self-supporting also needed to be looked into. Under the scheme, crèches having completed five years were to run the crèches on self-supporting basis. Absence of any assessment of 2514 crèches having completed five years out of the total 4885 sanctioned crèches clearly indicated lack of initiative to make the scheme more effective and increase the number of beneficiaries. The Committee was of the view that the Department should initiate an assessment of both categories of crèches getting central assistance as well as having completed five years. The Committee would like to be apprised about the details of crèches running on self-supporting 8.457 The Committee was dismayed to note that its comments about the number of residential courses being run under the Scheme (State-wise) and also the maximum limit of financial assistance being released per course both for residential and non-residential separately have evoked no response. The Committee, therefore, reiterated its earlier observation that the relevant details might be furnished to it at the earliest. The Committee have been given to understand that final report on the scheme by a Working Group set up about two years ago was expected sometime in August, 2005. The Committee would like to be apprised about the major recommendations of this Working Group and follow-up action initiated so far. 8.458 The Committee was of the firm opinion that the performance of this scheme also was much below the mark. It needed to be looked into so that its spread in terms of numbers in different areas could go up adequately. 8.459 Committee’s attention have been drawn by Mid Term Appraisal of Tenth Plan by the Planning Commission wherein it was pointed out that there was no information available on the status of self-help groups created under the scheme of Swyamsidha. It have also been emphasized that vigorous standards of evaluation need to be followed specially to assess the usefulness of this scheme. The Committee hoped that the Department would initiate necessary action without any further delay. 8.460 The Committee would like to point out that the Planning Commission also agreed with its view that Swayamsidha and Swa-Shakti were similar sounding schemes with similar objectives. The Committee would like to reiterate that the Department should initiate a comprehensive review of all its schemes, so that element of overlapping was completely eliminated. The Committee would like to draw the attention of the Department to the following observation of the Planning Commission in its Mid-Term Appraisal of Tenth Plan:- “Other schemes like Swawlamban and Support to Training cum Employment Programme (STEP)- training programmes for women with the objective of earning a livelihood in the non-traditional and agro-based sectors respectively – can also be combined with Swayamsidha. It is imperative that these small schemes be combined into one substantial scheme for SHGs for women”. 8.461 The Committee hoped that the Department would initiate the required action at the earliest in the light of observations made by the Planning Commission with an increased allocation.

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8.462 The Committee noted that in recommendation for reduction in the rate of interest to be charged from the beneficiaries under the Rashtriya Mahila Kosh was to be discussed by the Governing Board of the Kosh. A Sub-Committee was likely to be constituted to examine different aspects of micro-credit programmes, economic viability and sustainability of the Kosh. The Committee would like to draw the attention of the Department to the critical observation made by the Planning Commission in its Mid Term Appraisal of Tenth Plan regarding large proportion of available funds under Rashtriya Mahila Kosh lying unutilized. Such surplus funds were being invested in interest earning time deposits in commercial banks. The Planning Commission have expressed its apprehension that further expansion of the corpus of the Kosh might result in undesirable parking of funds. The Planning Commission have also observed that there was a need to evaluate the credibility of chosen NGOs under Rashtriya Mahila Kosh before the funds were committed. Specific recommendation for constituting a Committee of independent specialists in micro-finance and gender studies needed to be constituted for Rashtriya Mahila Kosh. The Committee hoped that the Department would undertake follow-up action at the earliest. 8.463 Department’s reply to Committee’s observation regarding highly uneven spread of financial assistance to NGO’s in different States reflected an attempt to shift the blame to the States; as if the Department was helpless in this regard. There was an urgent need for specific guidelines for the States and efforts be made to encourage more proposals from different areas/States. (n) 171st Report 8.464 The Committee observed that trend of utilization of allocated funds under SSA by State Governments was showing a positive trend. As on 31st March, 2005, State Governments have been able to utilize 83% of allocated funds. The Committee would, however, like to point these average figures did not give the actual status of the premier programme of the Department. The Committee was not inclined to fully accept the contention of the Department that every year a small proportion of funds would remain as unspent balance for the next year. Ground reality was that the increase in allocated funds was also reflected in the unspent/balances available with the States at the end of the year. Details furnished by the Department clearly indicated that against the availability of unspent funds of Rs. 1055.68 crore at the end of 2003-2004, this amount increased to Rs. 1283.00 crore in 2004-5. All India average utilization of 83.81% notwithstanding, there were State/UTs having a utilization average of 12.65 % (Pondicherry), 41.59 % (Arunachal Pradesh), 45.18 %(Delhi), 46.46% (Sikkim), 50.20% (Andaman & Nicobar Islands). The Committee would like to emphasise that the Department should pursue with the weak performing States/UTs to improve their utilization level. If need be, norms under SSA should be made state-specific.

8.465 The Committee noted that the information did not specifically delineate the targets achieved; it have clubbed the works in progress with those completed, The Committee was perturbed to note that 81% of the of drinking water facilities were either completed or in progress. This state of affairs was also evident in construction of toilets, recruitment of teachers and annual in service training of teacher. The Committee would like to have separate latest figures in respect of different components of SSA. The Committee strongly recommended that the Department took all measures to achieve its physical targets within a time frame. 8.466 The Committee felt that the progress in terms of achieving various targets under different components of SSA was of crucial importance. It noted that 56 percent achievement in case of toilets and 57 percent achievement in regard to drinking water might not be very significant; but those in progress, if included, did not present a dismal picture. The Committee emphasized the need for more vigorous efforts for achieving various targets as SSA was a time-bound scheme. 8.467 Reply of the Department did not speak about the state of elementary education as projected by the NIEPA report mentioned in the Committee’s recommendation. The Committee would like to have latest figures in respect of all the indicators mentioned in its recommendation contained in paragraph no. 2.18 8.468 The Committee was concerned over the slow pace of civil works for the construction of DIETs approved in 2004-05. It desired that the Department took all necessary measures to complete the construction without any further delay.

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8.469 The Committee have been informed that delay in the operationalisation of sanctioned DIETs took place mainly due to the time taken in construction of buildings, creation of posts, recruitment and placement of staff by States. The Committee would like to point out that the DIETs and SCERTs play a major role in the development of text-books, teaching-learning material, quality monitoring of schools. As per the information available with the Committee, out of sanctioned 550 DIETs, only 436 DIETs were operational. Last year, the Committee had commented about the lack of information about the functional status of DIETs in Bihar and Jharkhand. The Committee was constrained to observe that that position remained unchanged as response was still awaited to the Department’s communications in this regard sent to State Governments of Jharkhand and Bihar on 31st March, 8th April and 9th June, 2005. 8.470 The Committee noted that a Teacher Education Resource Group (TERG) have been constituted this year to review the implementation of the Teacher Education Scheme. The Committee would like to draw the attention of the Department towards the following observations made by the Planning Commission in the mid-term appraisal of the Tenth Plan:-

“The Joint Review Missions (JRM) of DPEP have noted that vacancies have not been filled in

many DIETs, affecting various training programmes… Teachers’ vacancies at all levels should be filled up urgently and there should be advance planning for future requirements too. Pre-service and in-service training of teachers should be strengthened and all the DIETs, BRCs and CRCs be made fully functional by filling up the vacant faculty positions… The performance of the institutional arrangements for teachers’ education should be closely and regularly monitored preferably by external agencies. ”

8.471 The Committee hoped that the Department would initiate the required action as suggested by the Planning Commission in the Mid-term appraisal of Tenth Plan. 8.472 The comments of the Department regarding action taken did not say anything about fixing goals time bound, about various components of the DPEP. 8.473 The Committee was concerned to note that the Mahila Samakhya Scheme was being funded from DPEP funds in Bihar, Jharkhand and Uttar Pradesh. The Committee strongly felt that such a practice might have adversely affected the execution of DPEP. The Committee desired that the MS Scheme be funded from the funds assigned for it. It should be ensured that there was no reduction at the RE stage in MS Scheme funds. 8.474 Last year, the Committee had observed that there was a need for having an assessment made about the working of Jan Shikshan Sansthans, particularly about the level of absorption of beneficiaries of vocational courses in industry. The Committee found that Planning Commission have also analysed the functioning of JSS in the Mid Term Appraisal of Tenth Plan in the following manner:-

“Evaluation showed that only 16 JSS (20%) out of 80 JSSs could be rated as ‘very good’ and 23 JSS, (29%) were graded either ‘average or below average’. Some of the JSSs are not functioning well, calling for urgent remedial and corrective steps to improve their activities. The quality of NGOs and their performance under JSS should be regularly monitored and an accreditation process evolved by the Central or State Governments to weed out those who have not performed.”

8.475 The Committee hoped that the Department would initiate corrective steps as suggested by Planning Commission. The Committee would also like to be apprised about the available data regarding absorption of JSS beneficiaries in industry. 8.476 The Committee expressed its concern about more than 50% children dropping out upto VIII class in the country, despite the fact that overall drop-out rate was decreasing. Such a situation, Committee felt, should not have any place for complacency in this regard. 8.477 The Committee was of the considered opinion that it was high time the Department should appreciate the gravity of the problem of drop-outs and out of school children. The Committee strongly felt that the proper implementation of all the schemes and programmes would have had positive impact on the universalisation of education. The Committee opined that there was an urgent need to take a fresh look into

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the problem and plug the loopholes to curb the problem of drop-outs. Higher-level discussion with the States could help in devising the appropriate measures in the matter. 8.478 The Committee was perturbed to note that a large number of under aged children have been enrolled in Class I in North-Eastern States. The Committee wanted to emphasise that the Department should take due care to ensure that the joy of childhood was not taken away in the race of attaining targets. 8.479 The Committee appreciated the efforts being made by the Department to help children pursue vocational courses at upper primary stage. However, the Committee felt that the Department should have been proactive in this regard and recommended that vocationalisation be vigorously taken up in other states also. VII. Secretariat 8.880 The Committee Section headed by a Committee Officer constituted the Secretariat of the Committee. An Additional Secretary, a Joint Secretary, a Director and an Under Secretary remained incharge of the Branch. A Research Officer was also attached with the Committee Secretariat. 8.481 To assist the Committee in its work, material received from the Ministries/Departments as also from other organizations and individuals was studied, and relevant points were culled out. Questionnaires for written/oral replies were prepared for use of the Committee.

8.482 The Committee also studied material like Parliamentary Debates, answers to Parliamentary Questions, Budget Estimates, Economic Survey, Mid-Term Appraisal of the Tenth Five-Year Plan, Books, Journals, and Newspapers etc. relevant to the subject under examination of the Committee. The Committee sent questions based on newspapers report/articles alonwith the questionnaire based on Expenditure Budget. The Committee also downloaded study material from websites on various subjects for preparation of reports.

8.483 The Committee collected material from on the spot studies and prepared study tour reports. 8.484 Having regard to the wider ramifications of ‘The Commissions for Protection of Child Rights Bill, 2005’, the Committee invited memoranda through press and electronic media from individuals/organizations/institutions etc. interested in the Bill. The Committee received 28 memoranda containing suggestions and comments on various provisions of Bill from various NGOs/ organizations/experts and individuals. The Committee also personally heard experts and NGOs on the Bill. The Committee also took views of the representatives of the Department of Social Justice and Empowerment and Ministry of Labour who were concerned with the Bill in addition to the Department of Women and Child Development who introduced the Bill. 8.485 The Committee prepared a comparative statement on various arguments and suggestions received on the Bill and the provisions relating to similar laws in vogue for the facility of the members of the Committee. Which provided a convenient overview on various provisions of the Bill at one place. 8.486 More than 500 memoranda were received from the non-officials on the subject 'University and Higher Education’ being examined by the Committee in response to a press release. The suggestions so received have been compiled and used in preparation of draft Report. 8.487 The Committee received number of memoranda on the press release issued on the subject of “Promotion of Sports’ the contents of which were being used in its deliberations as well as its Report on the subject which is under preparation.

8.488 The work relating to drafting, consideration and approval of draft reports by the Committee alongwith their presentation/laying, printing and distribution was undertaken. The Committee also dealt with the work relating to the scrutiny of Action Taken Notes received from the Ministries concerning the recommendations contained in the Reports of the Committee. The Section is also responsible for arranging/coordinating study visits and meetings at various places visited by the Committee/Sub-Committee.

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ANNEXURE – VIII (See Para 8.5)

Details of the sittings of the main Committee on HRD during the year 2005

S.No. Dates of

Sittings Duration Hrs.-Mts.

Subject

1. 05.1.2005 2 - 15 Oral evidence of the representatives of Delhi University Teachers Association and Delhi University College and Karmachari Union on various issues concerning University and Higher Education.

2. 17.1.2005 2 - 45 Oral evidence of Secretary, Department of Secondary and Higher Education on the University of Allahabad Bill, 2004 and Kendriya Vidyalaya Sangathan.

3. 18.1.2005 2 - 30 Oral evidence of representatives of Association of Indian Private Universities and Amity University on the role of Private Universities in Higher Education and problems being faced by them.

4 27.1.2005 0 - 30

Decided to undertake a study visit to Bhopal, Mumbai and Thiruvananthapuram from the 14th February to 19th February, 2005 in connection with consideration of subjects namely; (i) Promotion of Sports; and (ii) University and Higher Education.

5 22.2.2005 1 - 30 Oral evidence of the Vice Chancellors of Jawaharlal Nehru University and Delhi University on the University of Allahabad Bill, 2004.

6 26.2.2005 1 - 30 Consideration and adoption of Draft 154th, 155th and 156th Reports.

7. 11.3.2005 1 - 45 Clause-by-clause consideration of the University of Allahabad Bill, 2004 alongwith the officials of the Ministry of Human Resource Development (Department of Secondary and Higher Education) and Ministry of Law and Justice (Legislative Department.

8. 22.3.2005 0 - 50 Considered and adopted the One Hundred Fifty-sixth Report on Action-Taken by Government on the recommendations/observations contained in the 152nd Report on Demands for Grants (2004-2005) of the Ministry of Youth Affairs and Sports.

9. 30.3.2005 6 - 45 Oral evidence of the Secretaries, Ministry of Youth Affairs and Sports and Department of Women and Child Development on Demands for Grants 2005-2006.

10 31.3.2005 8 - 15 Oral evidence of the Secretaries, Department of Secondary and

Higher Education and Department of Elementary Education and Literacy on Demands for Grants 2005-2006.

11. 11.4.2005 0 - 30

Considered and adopted the following reports: (i) Functioning of Kendriya Vidyalayas; (ii) The University of Allahabad Bill, 2004

12. 20.4.2005 2 - 30 Considered and adopted the draft reports of the Committee on Demands for Grants 2005-2006 of the Departments of Elementary Education and Literacy, Secondary and Higher Education and Women and Child Development.

13. 5.5.2005 1 - 15 Considered and adopted the draft report of the Committee on Demands for Grants 2005-2006 of the Ministry of Youth Affairs and Sports

14. 12.05.2005 0 - 45 The Committee was informed of the reference of “The Manipur University Bill, 2005’ as introduced in the Rajya Sabha, for examination and report. The Committee decided to hear the Secretary of the Department of Secondary and Higher

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Education on the Bill. 15. 20.05.2005 1 - 30 Oral evidence of the Secretary, Department of Secondary &

Higher Education on the Manipur University Bill, 2005 16. 2.6.2005 2 - 00 The Committee was informed of the reference of “The

Commission for Protection of Child Rights Bill 2005’ as introduced and pending in Lok Sabha for examination and report within three months.

The Committee undertook Clause-by clause consideration of the Manipur University Bill 2005 and adopted it with certain modifications.

17. 16.6.2005 1 - 45 Oral evidence of Secretary, Department of Women and Child Development on “The Commissions for Protection of Child Rights Bill 2005”.

Heard the representatives of CII, ASSOCHAM, PHDCCI & EPSI on problems/challenges before University and Higher Education with special reference to the role of industry and commerce in supplementing the efforts of the government in promoting higher education in the country.

18. 27.06.2005 5 - 10 Heard the experts and representatives of certain NGOs on the provisions of Commissions for Protection of Child Rights Bill 2005.

Decided to undertake study visit to Srinagar and Leh w.e.f. 14 to 19 July 2005. The Committee authorized the Chairman to approach the Hon’ble Chairman to obtain permission for the visit of the Committee.

19. 06.07.2005 2 - 30 Oral evidence of the experts and representatives of some NGOs on ‘The Commissions for Protection of Child Rights Bill, 2005’.

20. 04.8.2005 0 - 50 The Committee undertook Clause-by clause consideration of ‘The Commissions for Protection of Child Rights Bill, 2005’alongwith the representatives of the Departments of Women and Child Development & Social Justice and Empowerment and Ministry of Labour.

21. 17.8.2005 0 - 55 The Committee undertook Clause-by clause consideration of ‘The Commissions for Protection of Child Rights Bill, 2005’, and adopted it with certain modifications.

22. 23.8.2005 0 - 30 Considered and adopted the report on the action taken on the recommendations/observations contained in its 153rd report on Gender Budget Analysis.

23. 13.9.2005 2 -10 Oral evidence of the Secretary, Department of Secondary and Higher Education on “The National Commission for Minority Educational Institutions (Amendment) Bill, 2005”.

24. 27.9.2005 1 - 15 Considered and adopted the Report on the National Commission for Minority Educational Institutions (Amendment) Bill, 2005.

25. 6.10.2005 3 - 30 1. Oral evidence of the experts, representatives of some NGOs implementing SSA and MDM in Delhi.

2. Officials of the Department of Elementary Education and Literacy and Directorate of Education, Govt. of NCT of Delhi on the implementation of Sarva Shiksha Abhiyan and Mid Day Meal Scheme.

3. Oral evidence of officials of Department of Elementary Education, Government of India.

26. 18.10.2005 3 - 10 Oral evidence of the Secretary, Ministry of Youth Affairs and Sports on problems and issues arising out of the Committee’s

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visits to sports complexes at Ahmedabad, Bangalore, Bhopal, Kollam and Thiruvananthapuram and general issues relating to promotion of sports in the country.

27. 28.10.05 3 - 40 1. Meeting with the Members of the Committee of Competitiveness of the Senate of Mexico on aspects related to Indian Policy on Education and Capacitation on human resource development.

2. Oral evidence of the Department of Women and Child Development on the implementation of Integrated Child Development Services (ICDS) scheme with special reference to the North-eastern States and Jammu & Kashmir.

3. Oral evidence of the officials of the Department of Elementary Education and Literacy on the implementation of Sarva Shiksha Abhiyan and Mid Day Meal Scheme with special reference to the North-eastern States and Jammu & Kashmir.

28. 08.12.2005 0 - 55 1. Considered and adopted the 168th report on the action taken on the recommendations/observations contained in its 159th report on Demands for Grants (2005-2006) of the Department of Secondary and Higher Education

2. Considered and adopted the 169th Action taken Report on the recommendation/observation contained in 163rd report on Demands for Grants (2005-2006) of the Ministry of Youth Affairs and Sports

29. 14.12.2005 1 - 40 1. Considered and adopted the 170th report on the action taken on the recommendations/observations contained in its 160th report on Demands for Grants (2005-2006) of the Department of Women and Child Development.

2. Considered and adopted the 171st report on the action taken on the recommendations/observations contained in its 158th report on Demands for Grants (2005-2006) of the Department of Elementary Education and Literacy.

30. 22.12.2005 0 - 45 The Committee took the following decisions:

1. To prepare and submit separate Report on implementation of Sarva Shiksha Abhiyan, Mid Day Meal Scheme and Integrated Child Development Services in Jammu and Kashmir and North- East.

2. To further hear the Secretary, Department of Secondary and Higher Education along with the Commissioners, Navodaya Vidyalaya Samiti and Kendriya Vidyalaya Sangathan on Action Taken Notes submitted by the Department on 154th Report on “Functioning of Navodaya Vidyalayas” and on 162nd Report on “Functioning of Kendriya Vidyalayas” before finalizing its Action Taken Reports. 3. To consider & adopt the Reports on University and Higher Education and Promotion of Sports during the inter-session period and submit these reports in the beginning of Budget Session 2006.

4. To take up for detailed study problems related to implementation of (i) Sarva Shiksha Abhiyan & Mid Day Meal Scheme, and (ii) Integrated Child Development Services for the next year.

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CHAPTER- IX

COMMITTEE ON INDUSTRY

I. Composition of the Committee 9.1 The Department-related Parliamentary Standing Committee on Industry for the year 2005 was constituted on 5th August, 2004. The composition of the Committee was as under:-

Shri Santosh Bagrodia — Chairman

RAJYA SABHA

2. Prof. M.M. Agarwal 3. Shri Surendra Lath 4. Shri Suresh Bhardwaj 5. Dr. K. Malaisamy 6. Shrimati Sumitra Mahajan 7. Shri Pyarimohan Mohapatra 8. Dr. Vijay Mallya 9. Shri K.B. Krishna Murthy 10. Smt. Vanga Geetha

LOK SABHA

11. Shri Guharam Ajgalle 12. Shri Kailash Baitha 13. Shri Swadesh Chakraborty 14. Shri Subhash Deshmukh 15. Shri Ram Singh Kaswan 16. Dr. Vallabhbhai Kathiria 17. Shri Sunil Khan 18. Shri Sunil Kumar Mahato 19. Shri Prakash Paranjpe 20. Shri Kishanbhai Vestabhai Patel 21. Shri Rajnarayan 22. Shri Bagida Ramakrishna 23. Shri Sarvey Sathyanarayana 24. Smt. Rubab Sayeda 25. Shri Gurjeet Singh Rana 26. Kunwar Manvendra Singh 27. Shri Ganesh Singh 28. Shri Suraj Singh 29. Shri Chandramani Tripathi 30. Shri Girdhari Yadav 31. Shri Bapu Hari Chaure

9.2 On 5th August , 2005th the new Committee has been constituted. The composition of the present Committee is as follow :- Shri Santosh Bagrodia - Chairman

RAJYA SABHA 2. Shri K.B. Krishna Murthy 3. Prof. M.M. Agarwal 4. Shri Surendra Lath 5. Shri Suresh Bhardwaj 6. Dr. K. Malaisamy 7. Shri Pyarimohan Mohapatra 8. Dr. Vijay Mallya 9. Shrimati Sumitra Mahajan

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10. Vacant LOK SABHA

11. Shri Guharam Ajgalle 12. Shri Kailash Baitha 13. Shri Rajnarayan 14. Shri Swadesh Chakraborty 15. Shri Bapu Hari Chaure 16. Shri Subhash Sureshchandra Deshmukh 17. Shri Ram Singh Kaswan 18. Dr. Vallabhbhai Kathiria 19. Smt. Susmita Bauri 20. Shri Sunil Kumar Mahato 21. Shri Prakash Paranjpe 22. Shri Kishanbhai Vestabhai Patel 23. Shri Badiga Ramakrishna 24. Shri Gurjeet Singh Rana 25. Shri Sarvey Sathyanarayana 26. Smt. Rubab Sayeda 27. Kunwar Manvendra Singh 28. Shri Ganesh Singh 29. Shri Suraj Singh 30. Shri Girdhari Yadav 31. Shri Chandramani Tripathi II. Constitution of Sub-Committees of the Committee on Industry

Sl. No.

Sub-Committee Subject Name of the Chairman/Convener

1. Sub-Committee: -I For Ministry of Agro and Rural Industries

Dr. Vallabhbhai Kathiria

2 Sub-Committee-II For Ministry of SSI Prof. M.M. Agarwal

3 Sub-Committee-III For Ministry Of Heavy Industries And Public Enterprises

Dr. Vijay Mallya

4. Sub-Committee -IV For Action Taken Report Shri Sunil Kumar Mahato

III. Subjects Selected For Examination

9.3 The Department- related Parliamentary Standing Committee on Industry selected the following subjects for examination: -

Sl. No.

Ministry/Department Subject

1. Ministry of Agro and Rural Industries

Performance of KVIC.

2 Ministry of SSI Problems and Prospects of SSI sector. Financial and other support to SME sector.

3 Ministry Of Heavy Industries And Public Enterprises

Performance review of PSEs like Hindustan Photo Films under DHI.

4. Main Committee Performance review of PSEs like HMT, AYCL, Praga Tools, EIL under DHI. The KVIC (Amendment) Bill,2005; The Small Scale and Medium Enterprises Development Bill 2005; Demand for Grants 2005-06; Tax Proposals affecting the various segments of Industry; key concerns of SSI in select states; Requirement of Coir Industries for its promotion and proliferation; Professionalisation of Boards of PSUs; Inter sectoral Strategic Co-operation to promote SSI; Operational Effectiveness of PMRY, REGP & KVIC schemes in Bihar, Jharkhand, West Bengal & Maharastra.

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IV. (A) Sittings of the Committee: Till December, 2005 the Committee held 42 sittings lasting for about 88 hours. The details of the meetings are given in Annexure IX.

(B) Sittings of the Sub- Committee: Till December, 2005, 4 sittings of the Sub Committees were held lasting for 7 hours 35 minutes. The details of the said meetings are given in Annexure –X.

V. Study Visits: The Main Committee and Sub-Committees visited various parts of the country to have an in depth study of their respective subjects :-

Sl. No

Committee/Sub-Committee

Dates Places of visits Agenda

1. Main Committee 15th to 24th January, 2005

Kolkata, Bangalore, Hyderabad,

Bhubeneshwar, Mumbai, and Ahemadabad

Performance of PSEs, Professionalisation of Board of Directors of HPC, HAL, KIOCL, NALCO, NTC and Working of KVIC.

2. Main Committee 9th to 14th November, 2005

Kolkata, Chennai, Mumbai, Hyderabad

Revival of AYCL, HMT, KVIC (Amendment) Bill, 2005, unlocking of assets by CPSEs and support to AncillarIsation of SSIs

3. Sub-Committee-I 12nd to 19th, July, 2005

Kolkata, Pondicherry, Thiruvanandapuram,

Bangalore.

Working of PMRY, REGP, NPRI and KVIC.

Study reports on these subjects were prepared and presented. VI. Report Presented: During 2005 the Committee presented the following 18 Reports to the House: -

Reports no. and Date of presentation /laying in Rajya Sabha Lok Sabha

1 05.05.2005 160th 05.05.2005 160th Report on Tax proposals affecting the various segments of industries (Ministry of Small Scale Industries)

2 05.05.2005 161st 05.05.2005 161st Report on Action Taken by the Government on recommendations contained in the Committee’s 132nd report on MoU performance in respect of select Public Sector Undertakings;

3 05.05.2005 162nd 05.05.2005 162nd Report on Action Taken by the Government on recommendations contained in the Committee’s 146th report on Credit Flow to SSI Sector in Maharashtra;

4 05.05.2005 163rd 05.05.2005 163rd Report on Action Taken by the Government on recommendations contained in the Committee’s 147th report on Credit Flow to SSI Sector in the region of Bulandshahar;

5 05.05.2005 164th 05.05.2005 164th Report on Action Taken by the Government on recommendations contained in the Committee’s 150th report on Demands for Grants (2004-05) pertaining to Department of Public Enterprises (Ministry of Heavy Industries and Public Enterprises);

6 05.05.2005 165th 05.05.2005 165th Report on Action Taken by the Government on recommendations contained in the Committee’s 151st report on Demands for Grants (2004-05) pertaining to Department of Heavy Industry (Ministry of Heavy Industries and Public Enterprises);

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7 05.05.2005 166th 05.05.2005 166th Report on Action Taken by the Government on recommendations contained in the Committee’s 152nd report on Demands for Grants (2004-05) pertaining to Ministry of Agro and Rural Industries;

8 05.05.2005 167th 05.05.2005 167th Report on Action Taken by the Government on recommendations contained in the Committee’s 153rd report on Demands for Grants (2004-05) pertaining to Ministry of Small Scale Industries;

9 05.05.2005 168th 05.05.2005 168th Report on Demands for Grants (2005-06) of the Department of Public Enterprises;

10 05.05.2005 169th 05.05.2005 169th Report on Demands for Grants (2005-06) pertaining to Department of Heavy Industry

11 05.05.2005 170th 05.05.2005 170th Report on Demands for Grants (2005-06) pertaining to Ministry of Agro and Rural Industries.

12 05.05.2005 171st 05.05.2005 171st Report on Demands for Grants (2005-06) pertaining to Ministry of Small Scale Industries.

13 12.05.2005 172nd 12.05.2005 172nd Report on Requirement of Coir Industries for its promotion and proliferation (Ministry of Agro and Rural Industries).

14 12.05.2005 173rd 12.05.2005 173rd Report on Inter-Sectoral strategic co-operation to promote Small Scale Industries

15 12.05.2005 174th 12.05.2005 174th Report on Operational effectiveness of PMRY, REGP and KVI schemes in Bihar, Jharkhand, West Bengal and Maharashtra.

16 12.05.2005 175th 12.05.2005 175th Report on Key concern areas of Small Scale Industries in select states.

17 4.08.2005 176th 4.08.2005 176th Report on SMED Bill 18 13.12.2005 177th 13.12.2005 177th Report on KVIC (Amendment) Bill, 2005

Relevant Minutes of the sittings of the Committee on Industry relating to various reports presented to the House were prepared and presented to the House alongwith the relevant reports.

VII. Summary of the Recommendations

(a) 160th Report

Level playing field to the domestic industry

9.4 The Committee stated that the tempest of globalisation could gallop the Temple of Modern India unless and until level playing field was provided to the domestic industry. The Committee was of the strong view that the architect of Modern India should not forget to have the protected layer of extending certain tax concessions/exemptions to protect against the onslaught of Faustian MNCs.

9.5 Even under the prevailing WTO regime countries like USA, China, Japan, Germany determine the economic policy keeping in view the strength of the local industries and there competitive resilience to face the challenges of the global competition, and these developed countries never forget to protect their domestic industries in the sector/field where their products could not compete with the products of other countries including India for example iron and steel products. These countries impose anti-dumping measure and adopt/adhere to the other fiscal measures to discourage Indian products with the motive to encourage/protect/promote there domestic industries . Such selective measure adopted by developed nations goes against the interest of industries in the developing countries like India, where on practical plane, there was enhanced need for protecting the domestic industries more than that of the developed nations as the responsibility for developmental activities lies more with the Government of developing nations than the developed one. That was so because the Governments in the developing nations had to overcome the mammoth problem of poverty, population explosion and unemployment. Under the circumstances, a developing nation like India, the Government has the added responsibility to protect, promote and consolidate

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the domestic industries from the onslaught of MNCs unleashed due to on going liberalisation and globalisation process in the post WTO - regime. Indian domestic industries must be strengthened and consolidated before their global exposure. Need was to imbibe competitive resilience into the Indian industries of various segments. Excise duty on synthetic and artificial staple fibers 9.6 The Committee, therefore, urged upon the Government that the excise duty on synthetic and artificial staple fibers under Chapter Heading 55.03& 55.04 of Central Excise Tariff may be reduced to 8% in this Budget itself.

Electronic Consumer Products 9.7 The Committee viewed that the market of consumer electronics was rapidly growing. The electronic components were the input products and back bone of electronic consumer products. Even then no growth was coming in the manufacture of electronic components because it could not compete with the rapidly growing grey market due to highest rate of excise duty @ 16%. The Committee, therefore, felt that the excise duty should have been be reduced to 8% for all locally manufactured electronics products and in puts. Excise duties exemption to SSI

9.8 The Committee pleaded that even to the Department of Revenue the Kelkar Committee's recommendation on confining the excise duties exemption to SSI to a limit of 40 lakh was not acceptable, and there was a valid reason for non acceptance of the Kelker Committee's recommendations on the issue keeping in view the inflation rate and largely the reasons on account of the need for giving adequate space to small enterprisess to grow into medium enterprisess as per the declared policy of the Government. Therefore, there was the need for purposive and supportive tax structure to give flip to emerging SMEs. The Committee stated that there was the strong reason for enhancing the excise duties exemption to SSI from the current level to a reasonable level.

9.9 The Committee understood the problems being faced by the Paint & Coating Industry and therefore, was in agreement that the exemption limit be reasonably raised and the restoration of concessional rate of 60% duty with the CENVAT up to Rs.1.00 crore, as such fiscal measures could help in reducing the cost of SSI products and imbibe competitive resilience in the units engaged in Paint & Coating Industry. The Committee was also of the view that the Department of Revenue should have been give kind consideration to exempt the vocational institutes and recreational training institute including the institutes under philanthropic non-profit making organizations from the Service Tax. The Committee recommended that in order to promote the small enterprisess sector, certain fiscal measures need to be taken to establish a SSI-friendly tax regime. These include: (i) Extension of General SSI Excise Exemption to SSI units manufacturing branded goods in urban

areas, as available in rural areas; (ii) Increase in the excise exemption to new as well as existing SSI units in rural as well as urban areas; (iii) Lower custom duties on import of raw material (basic raw material and intermediate goods) and

higher duties on finished products; (iv) Incentives to facilitate exports by the small enterprisess; (v) In order to induce small enterprisess sector to undertake technology up gradation, excise and

customs duty relief / concession be provided to small enterprisess on purchase of plant and machinery for technology upgradation;

(vi) Incentives for ancillarisation so as to establish better linkages between the large and small enterprisess;

(vii) Above all, once a concession / new fiscal provision was announced, it should have been maintained for at least three years in order to maintain continuity and growth.

ARAI 9.10 The Committee was of the view that institutions like ARAI plays pivotal role and should have not been debarred of benefit of concessional duty under the Notification No. 50/96-Customs, which covers only ‘companies’. The Committee recognizes that extension of such facility to ARAI could enhance the R&D capability in the auto sector. The case of ARAI must be re-considered by the Department of Revenue. The

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Committee recommended that the benefits of the Notifications No. 50/96 & 51/96 should have not been discriminated against the premier R&D institutions like ARAI.

(b) 161st report

Human productivity Index 9.11 The Committee was of the view that the element of human productivity in an organization should have been given due weightage in the administration of MOU system. The ratio of return on wage Bill should have been the determining criterion/parameter for awarding grades under the MOU system. This was to ensure that the organization had rational human planning system so that the right people were placed at right position in right time for effectively achieving the objective of the organization. In a globalized and liberalized economy human productivity was the key factor for imbibing ' competitiveness' and resilience for catching up the global pace. Ash Utilisation 9.12 The Committee was of the view that MOU system should have been incorporate provisions/parameters for giving adequate weightage for protection of environment. In this regard, the Committee expected that NTPC's could continue to promote the Centre for Power Efficiency Environment Protection (CENPEEP) for undertaking eco-friendly and eco-nurturing steps to ensure clean environment entails sustainable development.

Adequate Exposure and Awareness 9.13 The Committee was of the view that due to process of liberalization and globalization at the advance stage, the corporate working environment was fast changing its facets, therefore, the training curriculum must incorporate the modern method of doing work. This could be imparted through constant interaction among top executive through participation in conferences, debates and discussion in various international fora /organization Project management skills 9.14 The Committee was pleased to note that NLC had the provision for inculcating among its executives the modern business practices keeping in view the changing environment. However, skill development programmes could also be developed so that new ideas and innovations might be imbibed through in-house-experiment and outcome of which may be marketing to global corporate. Skill Development as per the changing external environment (say globalization and liberalization) was the key to success for any organization. Such messages might be proliferated to all PSUs.

Lengthy procedure in the process of approval of projects 9.15 The Committee was of the opinion that not only in time taken for approval of the projects needed to be rationalized /shortened but the cumbersome procedure involved in the process of approval could also be simplified for enabling the PSUs for improving MOU-performance. The Committee was also of the view that since the time taken for prescribed time period of 16 weeks (as prescribed by the Ministry of Finance) the same might further be reduced, otherwise the time periods for preparation of DPR should have been fixed.

State of Art the Technology 9.16 The concern of the Committee was the loss of huge power, be it at transmission stage or at the sub-transmission stage. Irrespective of the fact whether the such huge loss was owned by Central Government as transmission or development loss or State utilities mainly taking place in sub-transmission and distribution system, it was in all counts the national loss. Therefore, the Committee felt that the POWER GRID, which had been entrusted with the responsibility to extend it expletive with all available State of the Act technologies to various States, must play its role of Advance-cum-consultant to the states in designing optional distribution system for reducing distribution losses. POWER GRID must honestly oversee the implementation of Accelerated Power Development & Reform Programme (APDRP) under distribution reform for optimal transmissions/distribution of power without losses.

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(c) 162nd report

Fiscal/ Financial Incentives For New Technologies/ Modernization

9.17 The Committee was of the considered view that with the opening up of national economy, there was the need for consolidation of domestic SSI sector to enable the SSI units to face the stiff competition with the global SSI products. In this regard, reduction in the cost of production through introduction of latest technology and knowledge networking through linkages of research institute with the SSI sector becomes all the more necessary. The Committee welcomed the setting up of Technology Resource Centres (TRCs) and hoped that its promotional role should have been proven significant for integration of the SSI sector with the global market. The Committee however could be informed of the impact of these incentives in SSI sector and the monitoring mechanism for implementation.

Impact Of Globalization And Liberalization On Small Scale Sector And Role Of Banks 9.18 Although SIDBI had set up the Technology Bureau for Small Enterprisess (TBSE) in 1995 to help SMEs tap opportunities at the global level for acquisition of technology and establish business collaborations, however, nothing substantial has come out in regard to fulfillment of technology and collaboration related needs of the sector. The Committee therefore, recommended that SIDBI should have been made action plan for popularization of the functional aspects of Technology Bureau for Small Enterprisess (TBSE). Besides there was the need for further popularization of Credit Linked Capital Subsidy Scheme and development mechanism for appropriate addressing the technological requirement for SSI sector. Corpus for Credit Guarantee Fund Trust Scheme for Small Industries (CGTSI) 9.19 The Committee was of the considered view that the enhancement of the corpus for Credit Guarantee Fund Trust Scheme for Small Industries (CGTSI) could lead to larger coverage of collateral free and without third party guarantee credit to the SSI units. Although, the Committee knew that the corpus of the trust originally to the tune of Rs. 125 crore has gradually been enhanced to Rs. 767.44 crore in September, 2004 but the quantum of corpus was not adequate yet, therefore, the Committee strongly recommended that the Government should have been suitable enhance the corpus fund to increase the comfort level of the Member Banks/ Lending Institutions (MLIs) and encourage them to extend more collateral-free credit facilities to the SSIs/SSSBEs under the Credit Guarantee Scheme. The Committee desired that CGTSI should have been continue to make efforts to encourage private sector banks, foreign banks and regional rural banks as members lending institutes to participate in the Credit Guarantee Scheme.

Delay in Implementation of Nayak Committee recommendations 9.20 The Committee reiterated the implementation of Nayak Committee's recommendation in competition of working capital requirement of SSI units on the basis of the simplified method of minimum of 20 % of projected annual turn over of the borrowing units. The Committee desired that State Level Inter Institutional Committee (SLIIC) should have improved upon its functional aspects and should have been come out with sustainable strategy for re-habilitation of sick SSI units.

Insistence of collateral securities by various banks 9.21 The Committee desired to communicate the resentment and anguish of SSI Associations that despite the repeated guidelines of Reserve Bank of India to the Public Sector Banks for lending collateral free and without third party guarantee a loan up to a limit of Rs. 25 lakh, the Public Sector Banks could not abide by the guidelines of Reserve Bank of India. The general experience was that banks insist on collateral securities and mortgages for lending credit even for lower amount of money. It was further stated that banks were not providing SSI friendly working atmosphere as the bankers point out larger incidence of sickness in the SSI sector. In the meeting of Sub-Committee-II for the Ministry of Small Scale Industries (of Standing Committee on Industry) held on 11th April, 2005, the SSI Associations raised issues even against SIDBI which was not providing desirable services to the SSI units. The Committee therefore, recommended that bankers had to change their mind set and assist the SSI units in extending credit as per their requirement as SSI sector had the potential for employment generation and consolidation of national economy.

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(d) 163rd report Fiscal/ Financial Incentives For New Technologies/ Modernization

9.22 The Committee was of the considered view that with the opening up of national economy, there was the need for consolidation of domestic SSI sector to enable the SSI units to face the stiff competition with the global SSI products. In this regard, reduction in the cost of production through introduction of latest technology and knowledge networking through linkages of research institute with the SSI sector had become all the more necessary. The Committee welcomed the setting up of Technology Resource Centres (TRCs) and hoped that its promotional role could prove significant for integration of the SSI sector with the global market. The Committee however be informed of the impact of these incentives in SSI sector and the monitoring mechanism for implementation. Impact Of Globalization And Liberalization On Small Scale Sector And Role Of Banks 9.23 Although SIDBI had set up the Technology Bureau for Small Enterprisess (TBSE) in 1995 to help SMEs tap opportunities at the global level for acquisition of technology and establish business collaborations, however, nothing substantial had come out in regard to fulfillment of technology and collaboration related needs of the sector. The Committee therefore, recommended that SIDBI could make action plan for popularization of the function aspects of Technology Bureau for Small Enterprisess (TBSE). Besides there was the need for further popularization of Credit Linked Capital Subsidy Scheme and development mechanism for appropriate addressing the technological requirement for SSI sector. Corpus for Credit Guarantee Fund Trust Scheme for Small Industries (CGTSI) 9.24 The Committee was of the considered view that the enhancement of the corpus for Credit Guarantee Fund Trust Scheme for Small Industries (CGTSI) could lead to larger coverage of collateral free and without third party guarantee credit to the SSI units. Although, the Committee knew that the corpus of the trust originally to the tune of Rs. 125 crore had gradually been enhanced to Rs. 767.44 crore in September, 2004 but the quantum of corpus was not adequate yet, therefore, the Committee strongly recommended that the Government should have been suitable enhance the corpus fund to increase the comfort level of the Member Banks/ Lending Institutions (MLIs) and encourage them to extend more collateral-free credit facilities to the SSIs/SSSBEs under the Credit Guarantee Scheme. The Committee desired that CGTSI could continue to make efforts to encourage private sector banks, foreign banks and regional rural banks as members lending institutes to participate in the Credit Guarantee Scheme.

Delay in Implementation of Nayak Committee recommendations 9.25 The Committee reiterated the implementation of Nayak Committee's recommendation in competition of working capital requirement of SSI units on the basis of the simplified method of minimum of 20 % of projected annual turn over of the borrowing units. The Committee desired that State Level Inter Institutional Committee (SLIIC) could improve upon its functional aspects and come out with sustainable strategy for re-habilitation of sick SSI units.

Insistence of collateral securities by various banks 9.26 The Committee desired to communicate the resentment and anguish of SSI Associations that despite the repeated guidelines of Reserve Bank of India to the Public Sector Banks for lending collateral free and without third party guarantee a loan up to a limit of Rs. 25 lakh, the Public Sector Banks did not abide by the guidelines of Reserve Bank of India. The general experience was that banks insist on collateral securities and mortgages for lending credit even for lower amount of money. It was further stated that banks were not providing SSI friendly working atmosphere as the bankers point out larger incidence of sickness in the SSI sector. In the meeting of Sub-Committee-II for the Ministry of Small Scale Industries (of Standing Committee on Industry) held on 11th April, 2005, the SSI Associations raised issues even against SIDBI which was not providing desirable services to the SSI units. The Committee therefore, recommended that bankers have to change their mind set and assist the SSI units in extending credit as per their requirement as SSI sector has the potential for employment generation and consolidation of national economy.

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(e) 164th report DPE’s role as the nodal Department for all the CPSEs 9.27 The Committee was of the view that the Department of Public Enterprisess must assume its responsibility in order to discharge its function as per its mandate and according to the changing corporate environment and the domestic economic reality caused due to globalisation and liberlisation. It was because of the pivotal importance of its function that the department related parliamentary standing Committee on Industry had recommended in its earlier report for strengthening of the Department of Public enterprisess. It was now the time for the Department of Public Enterprisess to prove its raison-deter/justification for its continuation as separate Department. The Committee therefore recommended that the Department of Public Enterprwase should have been undertaken following activities effectively:

(i) Review of parameter under MoU system for performance evaluation as per global trend ; (ii) Determination of level of functional autonomy and linking the same with performance with

mode of periodic review;

(iii) fixation of delegation of financial power as per requirement of corporate world; (iv) Evaluation of existing human resources in all central PSUs and determine parameters and

premises for Comprehensive Human Resource Planning and Management including induction of professionalisation at all levels of management.

9.28 The Committee desired that Department of Public Enterprisess could have come out with concrete actions taken on above issues and accordingly apprise the Committee in its action taken note of the present report.

Plan allocation for IT sector

9.29 The Committee was of the view that the Department of Public Enterprisess had been entrusted with significant responsibility without adequate secretariat structure causing delay in the accomplishment of its duties. The Department remained' Lilliputian 'branch under the shadow of Department of Heavy Industry entrusted with enormous responsibility for co-ordinating and managing the affairs of Central PES, which was called in Nehruvian term, the "Temple of modern India”. The Department acted as nodal agency and was supposed to lay down the policy guidelines on performance improvement and evaluation, financial accounting and provides an inter-face between the administrative ministries and PSEs. Therefore, the Committee recommended that the Department could be strengthened and adequately staffed. That was so, as presently, the Government was taking its concerted efforts for employment generation and the success of CRR Scheme depended largely on the strengthened working of the Department of Public Enterprisess.

Policy For Economic Development For North Eastern Region

9.30 While the Committee appreciated the efforts undertaken by the Department of Public Enterprisess in the strengthening of CRR Scheme in the NER, however, the Committee could like to know the out come of efforts the Department for taking up the issue with the planning commissioner on granting special dispensation for starting residential programme for the VR optees to attracts large number of trainees. The Committee could like to know the details of number of beneficiaries under the scheme and their post training engagement during last 5 years along with details of expenses incurred thereon.

CRR scheme should have covered the traditional industries

9.31 The Committee desired that the Department of Public Enterprisess procure from the concerned Ministries the details regarding the deployment of VR optees in the post CRR phase in traditional industries of the region viz small scale and cottage industries, agro-based industries, IT, Truism Industries, Food processing Industries and furnish the same to the Committee.

Effect of Miniratna Status

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9.32 The Committee was not disputing the criteria and mode of performance evaluation of Miniratna PSEs by the Inter-Ministerial Group (IMG) and the Committee was also in agreements with IMG that the introduction of the scheme of the Miniratna resulting into delegation of financial and operational power to PSEs might have benefited the PSEs due to enhanced autonomy. So far so good. But the effect of the introduction of the scheme of Miniratna most had a bearing on the performance of the PSEs, therefore, the success of instruments of Miniratna depended largely upon the evaluation of enhanced performance of PSEs which have been so awarded as Miniratna status. Then and only then, the benefits of delegation of financial and operational powers backed by so acclaimed financial autonomy could be examined in appropriate perspective. Moreover, the membership of Miniratna status should have beennot remained a permanent feature, rather there should have been a dynamic and vibrating membership system wherein the actual/physical and financial performance should have been the guiding consideration for awarding and de-reserving the status of Miniratna.

Appointment of Non-official Directors

9.33 The Committee was constrained to express its dwaspleasure over the delay in the appointment of non-official Director on one or other flimsy ground. The Committee had not been apprwased of as to in how many of twenty Miniratna PSEs the vacouldcies of non-official director have been filled up, therefore, the Committee found the Department of public enterprisess short of its responsibility in dwascharging its function in relation to Board structure and its professionalwasation of central PSEs. The Committee during its study vwasit and interaction with select PSEs had found that post of part-time non-official directors (say in CCL, HEC, NALCO, Hindustan Copper Ltd., HAL etc.) had remained vacouldt for more then one year. This was a pathetic condition. On the other hand PSEs claimed to have professionalwasation of Board of Directors and functional autonomy as a result of delegation of financial and operational power, however, on the other hand, it was found that the posts of part-time non-official directors remain vacouldt for years. Under the circumstances, the functioning of the Board of Director became a matter of crystal understanding rather than a conjecture.

9.34 The Committee, therefore, impressed upon the Department of Public enterprisess to take up its responsibilities under its mandate and advise and monitoring the constitution of Board of Directors of Central PSEs to commensurate the acclaimed professionalisation and functional autonomy.

Training and skill development of lower and middle level executives

9.35 The Committee was pleased note that Department of Public Enterprisess keep in organizing executives Development Programmes for executives of PSUs However, what the Committee desired to convey was that due to the emerging complex domestic and global working environment as a result of under going liberalization and globalization process, the lesson of new management technique and practices must have percolated down to lower and middle level management in order to make than capable for coping with the pulls and pressures of fast emerging corporate governance in the post WTO-regime.

Rehabilitation of rationalized employees

9.36 The Committee was particular to the of the Department of Public Enterprisess over the response of the Committee's recommendation /conclusion that or presents only about 10 % of the rationalized employees were covered under CRR scheme. Instead of just noting the recommendation of the Committee DPE should have been acted upon by framing proposal as to how to cover the maximum of rationalized employees under the CRR scheme and same should have been taken up with the planning commission for obtaining required budgetary support. The productive rehabilitation of rationalized employees was the issue which concerns the Committee the most. The Committee desired that DPE may seek the assistance of private sector companies in this regard by framing a policy on the issue.

Skill upgradation and Entrepreneurship Development

9.37 The Committee liked to know whether with enhanced budgetary support a physical target of 32000 under the CRR scheme had been covered during the year 2004-2005 and if no, the reasons therefore; along with the alternative policy measure in this regard .

Training and credit facilities

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9.38 The Committee reiterated that Training and credit facilities could be extended also to the family members of rationalized employees so that the family income could be enhanced and preference should have been given under CRR Scheme whose outstanding money/amount of VRS was pending with the PSEs.

Social Audit of such rationalization

9.39 The Committee liked to know the follow-up -action undertaken by the Department of Public Enterprisess in line with the recommendation regarding the conducting of Social Audit of PSEs undergoing the rationalization Programme. The Committee desired to know the conclusion of social auditing of VR optees and its bearing on the CRR scheme. Human Resource Development 9.40 The Committee felt that the Department of Public Enterprisess must come forward in facilitating the CPSEs in the areas of Human Resource Development which well falls within parameter/mandate of Department of Public Enterprisess. The Department of Public Enterprisess had responded to the mandate and act in the like manner in the general interest of CPSEs.

Induction of professionals in Department of P. E. In CRR, MOU and Restructuring Divisions

9.41 The Committee liked to know the fellow up action on the part of Department of Public Enterprisess in regard to induction of professionals in Management CRR, MOU and Restructuring Division etc and the outcome in the form of effectiveness and efficiency in the working of these divisions as a result of induction of the professionals. (f) 165th report Requisite funds at the RE stage 9.42 The Committee liked to know the outcome of the efforts made by Department of Heavy Industries in regard to enhancement of allocation on various plan scheme at the RE stage during 2004-05 along with the progress of scheme on which the allocation has been enhanced. 9.43 It might be recalled that the Department of Heavy Industries had projected a demand to the tune of Rs.223.24 crore to the Planning Commission for the year 2004-05 against which the planning commission agreed to an allocation or Rs.131 crore sculting the allocation on the scheme like Coal Gassification, Auto Testing and Programme of Instrumentation Ltd. Kota (ILK), Braithwaith. Against this background, the Committee recommended for compensating the shortfall in the plan-allocation at the RE stage so that no project should have been suffered since the plan allocation of DHI has a direct bearing on the improvement of productivity of its PSEs. 9.44 The DHI had furnished incomplete, vague and inconclusive replies just stating the procedure as to what happens at the RE stage- " A review was held for expenditure on various plan schemes and based on progress of scheme, RE was proposed for further consideration of Ministry of Finance." - a reply which was known to all engaged in budgeting or interested and concerned to the budgeting process. The Committee was anguished that the Action Taken Note furnished by DHI was not specific and in line with the recommendation of the Committee for ready consideration. Increasing non-plan expenditure

9.45 The Committee was of the view that replies of DHI in regard to the Committee observation on increasing non-plan expenditure stated were facts only i.e. the Government provides support for viable revival schemes of PSEs. Generally such revival schemes contain fresh capital infusion for investments, write off of loans, conversion of loan into equity etc. The Committee's major concern was that the new infusion of fund was going into non-plan expenditure instead of creating capital and infrastructure for the company like technological up gradation and capacity enhancement etc. Government was only shedding the burden but it did not mean that PSEs were no strong enough to face competition. Because technological upgradation, marketing, human resource development, research and development were the initial strength of the company which required adequate investment to make PSEs viable and competitive

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Receipt from PSEs under DHI 9.46 The Committee welcomed the constitution of Board for Reconstruction of Public Sector Enterprisess (BRPSE) and hoped that expeditious decision could be taken in regard to PSEs under DHI for there restructuring and it was genuinely believed that Return on Investment (ROI) could improve. All investment in schemes could be made on the basis of Cost-Benefit Analysis and the restructuring programme might be completed with in determine time fame.

Utilization of extra budgetary sources 9.47 The Committee liked to know whether the finance so raised through extra budgetary resources was sufficient to meet the working capital requirement and right sizing of surplus man power and if not the alternative sources. Enhancement of internal resources 9.48 The Committee felt that the recommendation regarding states required to be taken enhance internal resources and limiting dependence of budgetary support has not been taken in right spirit. The Action Taken note only stated of consternation but not the steps which were required be taken to generate internal resources. The Committee could liked to know outcome of the review meetings in regard to loss making PSUs and also regarding whether the same has also been referred to BRPSE.

Plan expenditure towards strengthening the capital of PSEs 9.49 The Committee desired to know the plan components of budgetary support. The Committee was of the considered view that the restructuring/revival plan of PSEs must have been formulated comprehensively and implemented expeditiously to rationalize the non-plan expenditure and minimize the burden of government in marinating the PSEs. Delay in the matter could have resulted into financial burden of the government. Outstanding dues 9.50 The Committee was pleased to know that the out of outstanding dues to the tune of Rs.821.00 crores (Rs. 704 crores as statutory and Rs.117 crores as salaries and wages), to Rs.621 crore. (statutory Rs.517 crore and salary/wages Rs.104 crore) in 33 CPSEs spread over 9 Ministries/Departments as on 31-7-2004 have been paid. However, the Committee liked to whether DHI had got the sufficient supplementary grant approved to clear the statutory dues in regard to remaining three PSUs. Status of dues 9.51 The Committee reiterates that all necessary steps should have been taken to prevent reoccurrence of statuary dues of the work force as the pending salary payment de-motivates the work force to perform of the best. Inadequate Allocation for the Revival of RSEs 9.52 The Committee wondered if the revival package, as claimed by DHI, was prepared by operating agencies and implemented within a special time schedule and funds as released as per schedule prescribed then what happened then what and where goes wrong in the revival of PSEs. The Committees was of the opinion that the fact regarding revival package of PSEs was not as stated by DHI. There were plenty of complaints about pending decision, delayed release of aid and insufficient aid which further amounts to worsening of health of PSEs. Insufficient Infusion of Capital for Revival 9.53 The replies of the Department of Heavy Industries in regard to insufficient infusion of capital for revival of PSEs was superfluous and insufficient, therefore, the Committee could like to know from DHI :- (i) So far what were the major head that required major finance for revival and the general mechanism

to promote funding for revival of such units;

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(ii) whether all the PSUs under DHI have requisite fund/finance for revival and restructuring and if so

the schedule of releasing such aid has been decided in consultation with the PSEs ; and (iii) The approximate time taken in deciding such a package by BIFR, Govt. and operating agencies.

Introduction of a system of accountability on part of management 9.54 The Committee was of the opinion that replies furnish by the DHI in regard to Committees recommendation pertaining to introduction of a system of accountability on part of management of the company so as to guarantee the viable revival of the Unit after adequate funds were made available was bereft of actual fact. It was stated that responsibility of the management being implement through a system of MoU between PSEs and Government to achieve projected targets in the revival plans and on Government’s part to provide necessary funds as per the approved revival plan. Then the question arose as to why do the PSEs still complained of the insufficient revival fund or pending implementation revival plan.

Recurrent overall losses from PSEs 9.55 In regard to the Committees observation/recommendation pertaining to recurrent overall losses from PSEs, the Committee likeed to know the outcome of steps taken for improving the performance of PSEs viz. manpower rationalization, temporary financial assistance to sick units, purchase preference, restructuring/asset sale, MOU system for close monitoring and disinvestments etc and whether the losses have come down/minimized. Appointments pending mainly due to administrative reasons 9.56 The Committee wondered that if the process of filling up of the Board Level Posts was started 12 months in advance to avoid any delay in the process, then how the post as in the case of HCL, BWEL, BYNL,HMT and B&R remained vacant for years. The Committee strongly recommended that all efforts must have been made to fill up the vacant posts in time in future and furnish the Committee the details of the status of filling up of vacant post at present .

Heavy Engineering Corporation (HEC) 9.57 The Committee was in agreement with the conclusion of DHI that the presence of a full fledged Director (Marketing) in HEC could have strengthened the company in its marketing activities in the existing market scenario and desired that suitable action in this regard might have been taken without delay. It was during Committee's interaction with management of HEC at Ranchi that the Committee observed that the marketing wing of HEC needed immediate overhauling and induction of professionals in the field of marketing. Unless and until, HEC had the marketing department under the suitable professional the company could have not been in a position of formulating marketing strategy which indispensable for its revival/survival. Hoogly Printing Works and Tide Water Oil 9.58 Since the realisation of the fund to the tune of Rs.47.00 crore from disinvestments of equity holding in group of companies i.e Tide Water Oil Co. (I) Ltd. (TWOL), and Hooghly printing Co. Ltd. (HPCL) and Phoenix Yule Limited (PYL) was not in sight, the Committee was of the consider view that alternative course of restructure programme must have been sorted out in the rest of Andrew Yule and unit. Turning Around of Andrew Yule Co.

9.59 The Committee was of the considered view that the government should have been have expedited the consideration of restructuring proposal of Andrew Yule & Company ltd. for turning around the company without further delay. Requirements of the predecessor of BSNL 9.60 The Committee was in agreement with the DHI that any investment on HCL invites the cost profit consideration. However, the alternative course for revival of HCL had to be found out. The Sub-Committee-III for the Ministry of Heavy Industries and Public Enterprisess in its meeting held on 16th March, 2005 with

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the representative of HCL took a detailed over view of performance of the company and came to the conclusion that HCL being located in the backward region of the country and engaged in also the social welfare measures could be revived after infusion of sufficient fund for its revivals. The Committee endorses the opinion of the Sub-Committee. Expeditious decision on the revival proposals of HMT (Bearing) Ltd 9.61 The Committee reiterated that DHI must have pursued the case revival of HMT (bearing) Ltd. expeditiously. Lingering on further on the issue of revival on proposal could add to the financial liabilities of the company further.

Aforestation on the degraded land 9.62 The Committee liked to know the follow up action undertaken by the Department of heavy industry with the Ministry of Environment of the Forests and the out come of the efforts so undertaken in regard to aforestation of the degraded land. The Committee was pleased to know the matter regarding high royalty on bamboo was pursued with the Government of Assam. HPC have informed that the issue has been resolved.

Constraints being faced by the PSEs 9.63 The Committee was of the view that PSE which has been envisaged once as the 'Temple of Modern India' during the heyday of welfare state when these PSEs met the social obligation and thus played pivotal role in economic and social building of the nation. These PSEs were now reeling under deep trouble due to lack of orders, fluctuating duty refine, obsolete technology and investment crunch and were under the burden of restructuring and rationalizing there man power. The PSEs were not competitive and resilient enough to face the stark-realities of fast emerging now market economy. All previous steps for improving the financial health of PSEs fumbled one after another. Under the circumstances, the Government has to take careful and cautious efforts to rescuers the PSEs out of red. The constitution of Board for Reconstitution of Public Sector Enterprisess (BRPSE) under National Common Minimum Programmes was a new spectrum of rays of hopes which could inject 'Sanjivini booti' (new lease of life) there PSEs.

(g) 166th report Lack of support from the financial institutions 9.64 The Committee was perturbed to note that despite efforts made by the Ministry of SSI to enable KVIC to get sufficient credit flow from the banking sector could not yielded into satisfactory result. Moreover, financial institution does not honour the Interest Subsidy Eligibility Certificate (WASEC) issued by KVIC in favour of khadi institution on the basis of approved pattern of assistance resulting into insufficient flow of working capital to khadi institutions. During 2002-03, Rs. 378.07 crore worth of WASEC certificates were issued for providing working capital assistance to khadi institutions. Against this, the institutions could avail of Rs. 253.72 crore only , i.e., 67 per cent of the amount in the WASEC issued. For 2003-04, the amount of WASEC issued and credit availed of in the khadi sector was Rs. 387.09 crore and Rs. 298.78 crore respectively, i.e., 77 per cent of the WASEC issued- although showing an improvement of 10 per cent in availing of the total WASEC amount. 9.65 The Committee also took note of the fact that part of the working capital of the khadi institutions was also blocked with various was also blocked with various State Governments in the form of arrears of admissible rebates, therefore, the Committee recommended that Ministry of ARI should have been apprised the Committee, state-wise the details of arrears on account of admissible rates and take up follow up actions with the respective States Government and accordingly apprwase the Committee the outcome of its efforts so made. Labour law 9.66 The Committee was constrained to express its displeasure that the recommendation of the Committee has not been taken in right spirit. As the Committee has presented the 152nd Report in August, 2004 with the recommendation that the Ministry of ARI should have come out with specific details of labour reforms for improving Agro and Rural Industries and after the lapse of seven months in March, 2005 the Ministry of ARI come out with the idea that observation of the Committee were noted for future guidance. The Committee's

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recommendation in this regard entailed a particular course of action on the part of the Ministry of ARI i.e. brain storming session for chalking out the areas / issues for reform in existing labour laws affecting the ARI sector. Here at the Committee had not issued any behavioral modification which could have been noted for future guidance which performing a task. Therefore, the Committee desired that the Ministry of ARI should have been taken its recommendation in right earnest and avoids replying in a very casual manner.

Stock Inventories

9.67 The Committee observed that the reduction of stock inventories from Rs. 612.30 crore (khadi – Rs. 551.19 crore and Polyvastra –Rs. 60.84) as on 31st March, 2003 to Rs. 611.11 crore (Khadi – Rs. 549.45 crore and Polyvastra Rs. 61.66 crore) as on 31st March, 2004 was a very minute achievement in regard to Action Plan for disposing of the stock inventories in a time bound programme. The Committee was of the considered view that unless and until stock inventories was not cleared, the shortage of working capital could continue to be felt on the part of the KVIC.

9.68 The Committee expressed its pleasure over the increasing trend of employment generation in the khadi sector. During 2002-03 and 2003-04, the employment in the khadi sector has increased slightly to 8.59 lakh persona and 8.61 lakh persons respectively. However, for further widening the employment generation avenues in the khadi sector, the KVIC and the Ministry of ARI should have been paid adequate attention to production and sales planning, particularly product quality and marketability, provided working capital to KVIC institutions, undertake suitable steps for disposing of inventories stocks and undertake effective steps for payment of arrear rebates by the State Governments.

Potential of coir industries in non-traditional states like Uttar Pradesh, Orissa ,Bihar and Jharkhand. 9.69 The Committee appreciated the efforts undertaken by the Coir Board in proliferation of Coir Industry in the major coconut producing States like Kerala, Karnataka, Andhra Pradesh & Tamilnadu . The Committee was also appreciative of the initiative taken by the Coir Board in promoting coir industries in Orissa where a Rubberized Coir Manufacturing unit at the cost of Rs. 417.00 lakh was being established under the Centrally Sponsored Scheme of Co-operativwasation. The Committee hoped that the Coir Board could have implemented its strategy to set up coir units in the non-traditional states like U.P., Bihar and Jharkhand by sourcing coir fiber from the nearest available place and imparting training to the local artisans in spinning and weaving products. The Committee desired that concerted efforts must have been made to establish coir units in the non-traditional areas by sourcing fiber from the nearest coir producing States. National Programme For Rural Industrialisation

9.70 The Committee was of the considered view that by changing the name of the programme / scheme, from National Programme for Rural Industrialization to Scheme Of Funds For Regeneration of Traditional Industries (SFURTI) was not going to provide any remarkable achievement in regard to the stated objectives of the scheme originally conceived. The Ministry of ARI should have been extracted the benefits of SWOT analysis of NPRI and accordingly the Ministry should have been taken adequate and suitable steps for combating the problems of NPRI i.e. meager financial assistance of Rs 5.0 lakh per cluster for cluster-wide interventions, fill-in-gaps arrangements, non-availability of credit-linked subsidy component, inadequate synergy with the Ministries/departments with their own schemes in this area etc. with all seriousness. The Committee was of the considered view that NPRI should have remained in force as it contains the cherished objectives having potential for employment generation and consolidation of rural economy and growth. At best, SFRUTI could be made one of the component of NPRI or it could launched as a separate scheme. That was so because re-generation of traditional industries might cover only the confined component of the earlier conceived National Programme for Rural Industrialization. 9.71 The Committee observed that the Government has been the witness to the withering away of the cherished objectives and mission of consolidation of rural economy and arresting the rural migration to the urban areas under National Programme for Rural Industrialization and thereafter, when the Government has drafted a substitute scheme i.e. SFRUTI, although it does not cover all aspects of NPRI, Government was taking to much time in clearing the SFRUTI. Therefore, the Committee desired that SFRUTI may be launched without delay.

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Impact of globalisation and liberalization on Agro & Rural Industries 9.72 The Committee felt that the Ministry of ARI should have been taken up the issue of exemption the of KVI products from state level Value Added Tax (VAT) to the concern authorities advocating that the KVI products were not in a position to face stiff competition from the organized sector. Problems being faced by Agro & Rural Industries

9.73 The Committee, while appreciating the components of Product Development Design Intervention and Packaging (PRODIP), recommended that the scheme should have been implemented in letter and spirit. The Committee could like to know the details about the functions of Rural Industries Service Centre (RWASC) and its distribution in various states. The Committee further liked to know the details of "transfer of technology and technological intervention from Technology Information Forecasting and Assessment Council (TIFAC) and outcome thereof.

Revival of the Rural Infrastructure Development Fund (RIDF) 9.74 The Committee knows and understands that Revival of the Rural Infrastructure Development Fund (RIDF) falls within the jurisdiction of Ministry of Rural Development, however, sine the Agro and Rural Industries may be one of the major beneficiaries of RIDF, therefore, it should have been the Ministry of ARI which should have come out and make efforts in tandem with the Ministry of Rural Development chalk out action plan to boost the development of the clusters in economically backward states like Bihar, M.P., Chhatisgarh, Orissa and Jharkhand.

"New Deal" for rural India

9.75 The Committee was of the view that the Government, beside REGP, should have come out with comprehensive scheme for rural employment with the purpose of alleviating rural poverty and integrating rural economy with the national economy. (h) 167th report

Service auditing of Organs under the Ministry of Small Scale Industries

9.76 The Committee was of the view that Government should have undertaken service auditing of the organs under the Ministry of Small Scale Industries by the outside agencies and not by the DC (SSI) so that their delivery system could be improved for the betterment of the Small Scale Industries in the real terms. By the service auditing the Committee did not intend just the financial auditing, although the same was indispensable, but the purpose was to improve the delivery system.

9.77 The Committee was perturbed to know that the Planning Commission has not yielded the RE stage the genuine requirement of the Ministry of SSI in regard to providing additional plan allocation (Rs.415.12 crore) for Credit Guarantee Fund Scheme and against this requirement only Rs.196.29 crore was provided in BE 2004-05. Not only this, the other SSI promotional scheme viz Tool Rooms, Intergraded Infrastructural development Scheme got scuttled as a result of reduced allocation. The Committee expressed its deepest concern. On the one hand the Government was proposing for giving adequate space to SSI units to grow and thrive, which was appropriate move keeping in view the global trend for strengthening of Small Enterprisess but the planning and budgetary process in India was not adequately pushing the SSI sector ahead. SSI sector had the tremendous potential for employment generation and its contribution to the national exchequer was also commendable. So why not the SSI sector was being treated as the priority sector ? The Committee was of the considered view that SSI sector needed the sympathetic consideration from all quarters for its accelerated promotion and proliferation and to remain competitive in the liberalized and globalized economy. Therefore, the Planning Commission and the government approach towards SSI sector must have been focused on the same wavelength with congruence and consensus-aid-idem which was, in the Committee's view, was lacking at present. Grants to National Small Industries Corporation for development of Small Scale Industries

9.78 While the Committee was pleased to note that NSIC Board induct professional to imbibe the internal

competency levels in the organisation. However, the Committee wished that NSIC must leave its presence

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felt in the length and breadth of the country by launching the awareness programme on SME sector which was a move the worldwide.

9.79 The Committee liked to know as to what follow-up action has been taken in regard to the following

recommendations contained in 153rd Report:-

(i) NSIC should have been declared a nodal agency for purchases by Government Departments/Agencies. This will enable NSIC to play an effective role in marketing the products of the SSI sector; and

(ii) NSIC should have been treated at par with SSIDCs in matters relating to allocation of steel and other raw materials. At present, allocation of steel was made to NSIC only in those States where SSIDCs do not exist.

Loan Limit under the Credit Guarantee Scheme

9.80 The committee was of the view that the Government should have considered without further delay the enhancement of loan limit to Rs. one crore under the Credit Guarantee Scheme.

Credit Guarantee Fund Scheme

9.81 The Committee was of the considered view that to make the Small Scale Industries to grow into Medium Enterprisess, it was essential to make the Guarantee Fund Scheme a big success. It was so because only with the concerted efforts made by the CGTSI through its Member Lending Institutions (MLWas) in creating awareness of the scheme, the performance of SSI sector expected to pick up further. Since there was absence of effective mechanism for assessing the impact of the success of the Credit Guarantee Scheme, the Committee impresses upon the Ministry again to ensure the success of this scheme.

Members Lending Institutions (MLIs)

9.82 The Committee was of the view that Government should have implement the Credit Guarantee Fund Scheme with all out efforts, otherwise, half-heartedly approach could have only deterred in achieving the objectives and targets of the Scheme. The Credit Guarantee Scheme intended to promote and proliferate the SSI sector through Member Lending Institution (MLIs) needs to be given proper attention and infusion of sufficient corpus money, which has been projected to the tune of Rs.2500 crore by the Government. But allocation of fund on the shoe-string policy could have proved loggerhead in making the scheme a success.

Credit Rating

9.83 The Committee observed that Credit Rating Agency was yet to start its functioning and it was the responsibility of the Ministry of SSI and SIDBI to ensure its success. The Committee liked to be informed of its progress periodically.

Sunrise industries in the SSI sector

9.84 The Committee liked to know the outcome of efforts made by the Ministry of SSI in regard to identification for promotion of the sunrise industries in the SSI sector viz. Information Technology (IT), Biotechnology, Pharmaceutical, Nano-technology. The Committee further liked to know the details of future outlook of these sunrise industries in Orissa, Bihar, Jharkhand, Chhattisgarh, Uttranchal, U.P., Madhya Pradesh and Rajasthan - the states which needed economic upgradation.

Credit flow to SSI Sector 9.85 The Committee understood that RBI guidelines contained the potential for actual financial assistance to SSI units, however, the Committee was of the view that the efforts of the banks in extending credit to the SSI sector could be considered a success only when the percentage of net bank credit to SSI sector increases from the present status of 10.4 per cent to at least the previous level of 17-18 per cent.

9.86 The Committee welcomed the initiative taken in regard to "India SME Technology Services Limited" and hopes that the newly set up institute could provide integrated services to the SMEs.

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Friendly tax regime for SSI

9.87 The Committee reiterated the need for undertaking initiatives/measures for SSI friendly tax regime and other fiscal measure required to promote SSI at an accelerated rate keeping in view to not only to protect the domestic SSI sector from the onslaught of on going liberalization and globalization process but also to give sufficient space to Small Scale Industries to grow and thrive into the medium enterprisess.

(i) 168th report 9.88 The Committee felt that abolition of some of the divisions was unacceptable. It observed that without constant monitoring and consultations, the policy formulation could be reduced to a mere academic exercise. The Committee considered that such a situation could limit the full-potential and utility of a Department and thereby affecting the efficiency of the policy. Governance requires an objective and periodic assessment of the policies by the agencies that formulate such policies. As envisaged in its mandate, to evolve DPE as the key policy-coordinating department for the CPSEs, it must have undertaken constant monitoring, consultations and modifications of its guidelines. It must have also compile the data pertaining to the PSEs under all the Ministries/Departments and make appraisal. These information should have been posted at its Website for public access. 9.89 The Committee did not approves such an arrangement of allocating funds for the DPE under Iron & Steel Industry head. This needed to be corrected The Committee accordingly directed the DPE to take up the matter with appropriate Department to correct the same. The Committee expresses its dismay over the non-utilization of the fund for IT. The Committee could like to know the reasons of DPE’s inability to utilize the funds allocated for “Computerization of the Information on Personnel and Citizens Services”, as its objective was to improve administrative efficiency. The Committee also impresses upon the Department to take necessary steps so that such a situation does not occur in future. 9.90 The Committee also recommended that the Website of the DPE must be enriched with updated information and statistics on PSEs particularly on the schemes coordinated by the DPE. The Committee takes a serious note of under- utilization of funds for NE Region and under achievement of annual targets of CRR beneficiaries. The Committee found such case to be a sorry state of governance and indicative of serious disjoint in Government departments that must have been avoided in public interest. 9.91 The Committee, keeping in view the lack of cooperation among various Departments, recommended the DPE to undertake a serious study to ascertain the causes of under achievement of CRR beneficiaries and make corrections in the policy. The training should have forward linkage with market. The Department must have also look for the possibility to cover at least one of the family members of the beneficiary under CRR scheme so as to increase the family income. The Committee observed with concern the huge gap between VRS optees and the target set by the DPE for CRR coverage. Though the Committee appreciated that the yearly targets were achieved, however it sought the reasons for such a gap between actual VRS optees and annual target for CRR. 9.92 The Committee appreciated that the success rate was gradually increasing. Yet compared with the total VRS optees of whom CRR beneficiaries were only a small part, it could be safely inferred that the rate of rehabilitation of the rationalized employees was hardly satisfactory. The Committee, therefore, recommended that Government must look the success rate in comparison with total VRS optees and make serious corrections to increase the success rate of rehabilitation. The Committee also felt that in the CRR scheme, preference should have been given to those junior level functionaries to whom the VRS dues have still not been paid. Also the Committee could like to know about the interim measures taken to provide sustenance to such VRS optees whose dues were still pending with the PSEs. 9.93 The Committee be apprised of the reasons on which its recommendation to extend the benefits of CRR scheme to family members was refused by the Planning Commission. The Committee reiterated its recommendation as contained in its 150th Report in this respect, and recommended re-look into the issue as it will increase the family income of the VRS optee. 9.94 The Committee recommended that DPE must take up the issue involved in the implementation of CRR Scheme with respective PSEs and their Administrative Ministries to remove these constraints. The Committee

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could also like to know the steps taken on the evaluation study conducted by V.V. Giri National Labour Institute, to overcome the above constraints.

9.95 The Committee liked to know the details of professional eligibility criterion for the non-official Members of the BRPSE and the way they were selected. The Committee felt that sufficient provisions should have been made available to meet BRPSE’s requirements for providing expert advise on techno-financial issues pertaining to revival of PSEs. The Committee, accordingly, recommended the Government to provide sufficient funds for the smooth functioning of the BRPSE. The Committee, however, expressed concern over delay in finalizing the revival of PSEs that has incurred heavy cost of such delay in terms of depleting net worth and rising liabilities of PSEs. The Committee hoped that the delay in finalisation of the revival of PSEs could be avoided. 9.96 The Committee suggested that the Administrative Ministries/Departments should have been given time limit to refer the complete proposal to BRPSE. The Committee observed that pending the notification to repeal SICA, the linkage between the two bodies BIFR and BRPSE remains undefined. The Committee, therefore, recommended that the Government should have decided on linkage between BIFR and BRPSE at least, till such time a final decision on BIFR was taken by the competent Court. The Committee acknowledged the initiatives taken by the DPE to enhance the skills of the middle and senior level executives in PSEs. 9.97 The Committee also noted that management development courses were the main benefit of DPE’s membership of ICPE, which had been availed by only 76 executives in last three years with DPE paying an annual membership fee of US $ 75000. The Committee might be apprised of the items included under this contribution. The Committee liked the DPE to take a fresh look into the cost-benefit ratio of such membership and justify the same for forthcoming year’s Demands and inform the Committee accordingly. 9.98 The Committee might also be apprised of the criteria and process for the selection of candidates for such courses. The Committee recommended that DPE must make efforts with concerned Departments and Institutions, to conduct similar EDPs in India, with Indian Professional Institutions, for other ICPE members. Indian institutions must enter into huge global market of professional training and consultancy. Such programmes for other countries will enhance the academic and professional profile of our premier professional institutions. 9.99 The Committee noted with reservation that there was no specific programme for enhancing the skills of shop-floor level techniques. The Committee viewed it to be a stunted approach towards overall human development in PSEs. The Committee, therefore, recommended that DPE must organize orientation and skill development programme for floor-shop level technical functionaries as they were the end users of new material management and production techniques. The efficiency at shop-floor level ultimately reflected in the corporate performance of the Company. The Committee recommended that CPSEs must have adhered to the principles of Total Quality Management. 9.100 The Committee found the reply hardly convincing, and impresses upon the DPE to give a more serious effort to impart more structured and elaborate orientation to the management and technical staff in this regard. The Committee liked to know the nature of such support to PSEs in achieving the targets in MoU. The Committee observed that the number of PSEs earning favourable ratings was increasing while those getting ‘Poor’ rating have decreased. Keeping this in view, the Committee has also observed that the number of PSEs entering the MoU has been falling from 108 in 1999-2000 to 96 in 2003-04.The Committee wondered , if the PSEs having poor ratings were being excluded from the MoU system. If that was true, was it safe to construe that the Government’s support under MoU system was practically not available to the loss making PSEs. The Committee liked to know if there was a policy to exclude such PSEs from signing the MoU. If so, the Committee liked to know the rationale behind such policy. 9.101 The Committee desired that the Government should extend its support to the PSEs signing MoU without compromising the MoU parameters. The policy should be such so as to include more PSEs to sign MoU. It desired the DPE to examine the issue. The Committee felt that the financial parameters in the MoU system still did not reflect the fact that the PSEs were still largely dependent on bulk Government orders. Most of the PSEs still did not have any significant presence in global export market despite being in the business for long. Most of the Excellent- rated PSEs function in monopoly market environment. The PSEs had not been able to secure the ‘Brand loyalty’ of customers, wherever the sector has been opened up for

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private sector and this was reflected in the receding market share of such PSEs. The Committee liked to have DPE’s comment on its observations. 9.102 The Committee took note with reservation that DPE has not conducted any specific Survey conducted in relation to technological obsolesce of PSEs. In view of the fact that the PSEs were established as the pioneers in industrial technology, the Committee recommended that the Government must have undertaken a survey to ascertain the technology status of PSEs that has definite bearing over profitability and efficiency of the Public Sector. The DPE being the nodal coordinating Department on non-financial policies, must have prepared a comprehensive approach paper on Sector-wise technological status of PSEs in consultation with respective PSEs, Administrative Departments and expert agencies like DSIR.

9.103 Considering that the PSEs were envisaged as the pioneers in industrial technology, the Committee observed that Technology and R&D had not been suitably factored in MoU ratings of the PSEs that were essentially Techno-commercial entities. As such Technological upgradation and R&D should have been an integral part of revival strategy of the PSEs. It was observed by the PSEs that most of the PSEs do not have an elaborate R&D set up. The Committee wondered if PSEs have owned any patent in recent years, which itself was a distinct commercial activity.

9.104 The Committee recommended that technology upgradation and R&D must be given due weightage in MoU parameters in consultation with expert bodies like DSIR. The Committee also recommended that as a part of re-aligning with market, the PSEs should have been involved in technology trade and consultancy services that might have enhanced their profitability at a lesser additional investment.

9.105 Despite elaborate policy intentions to include persons of proven expertise in the Boards of PSEs, the Committee had observed that former bureaucrats, serving representatives of autonomous organisations under Government, representatives of subsidiary companies, have been included in the Boards as Independent Directors in addition to Functional and Official Part-time Directors. In several cases the retired bureaucrats were reappointed as Independent Directors. The Committee felt that such an arrangement does not fall in the spirit of the policy of appointing Independent Directors on the Boards of Directors of the PSEs. The Committee also expressed reservation on the practice of renewing the tenures of existing Directors in some cases. The Committee urged the department to ascertain that the implementation of policy was in consonance with its true objectives and bring to the notice of this Committee any dilution in the ‘Professionalisation’ of Boards.

9.106 While interacting with the PSEs, the Committee had observed a clear disjoint in the Central and State Governments that has seriously imperiled the viability of such PSEs. The Committee was of the view that greater involvement of the stakes of the respective State Government was essential to clear such disjoints. Also a senior representative of the concerned State Government should have been included in the Boards of PSEs as one of the two Government Directors. The Committee observed that distinct preference was given to serving officers from Armed Forces in the Board level appointments in the PSEs under the Ministry of Defence, on the plea that Armed Forces were the premier customers of these PSEs. The Committee wondered , if such an arrangement reduces PSEs as a captive Company instead of an autonomous commercial entity. The Committee was of the view that the products of these PSEs have a large civilian market too. The Committee feels that if the private sector was being involved in the defence sector, why could not the defence related PSEs harness potential in civilian and export market with their dual-use products and technology. 9.107 The Committee was of the opinion that there should have been uniformity in the qualification, selection and mandate of Non-Functional Part-Time Directors, as too many categories within one Board may affect its efficiency and autonomy. The Board must be defined in terms of its mandate and the interest of the Company and not by the categories of its Directors. The Committee liked to have Government’s comments on the need for uniformity in Part-time Directors. The Committee recommended that the Government must impress upon the concerned Ministries to adhere to the time frame for the selection of Directors and expedite the appointments of Directors. 9.108 The Committee was constrained to observe that the information provided by the DPE was not only evasive but also insufficient and incomplete. The Committee observes that DPE had not reacted to the criteria of “Independent Directors” as elaborated by the Naresh Chandra Committee. Similarly the DPE had not

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responded to the Narayan Murthy Committee’s recommendation on “ Nominee Directors”. The Committee observed that these expert Committees were set up by the Government or the agencies under its control. The Reports of these expert Committees were extremely relevant to the issue of Professionalisation of Boards as they deal extensively the mandate, functional autonomy, obligations and the constitution of Boards of Directors. Their findings could be applied to enhance the autonomy and efficiency and draw greater degree of professional excellence to the Boards of Directors. 9.109 The Committee recommended that the DPE should have assessed these reports more fruitfully instead of dismissing them for administrative nuances and inform the Committee of its views and rationale thereof. The Committee felt that the minimum educational qualification should have been raised to a Post Graduate Degree/Diploma from a premier institution in a professional course, management, engineering, financial management or HR management. Also the size of corporate body should have been specified for the CMD/MD being appointed as the Independent Directors.

9.110 The Committee felt that a Joint Secretary belongs to a generalized service, he might not have requisite and relevant expertise to become an Independent Director in a PSE unless he had the experience of those many years in the field relevant to the functioning and corporate objectives of the PSE. The Committee recommended that this aspect should have been specified in the eligibility criteria for Independent Directors. The Committee feels that the maximum age for Independent Directors too should have been appropriately reduced to maintain uniformity in the Board of Directors. Many PSEs particularly in Heavy Industry Sector, had complained lack of orders from Government and PSEs as major cause of their financial constraints. The Committee could like DPE to identify the Sectors that still rely heavily on Government orders. 9.111 The Committee felt that Purchase Preference Policy could be treated only as an interim arrangement. Such an arrangement contributed practically nothing to the Consolidated Fund by way of earning from market. The PSEs might have been increasingly encouraged to diversify in the open market and re-align themselves with the emerging market through Joint Ventures and global marketing alliances instead of relying solely on Government/PSEs for orders. Though the Policy provides a cushion for PSEs, they must take benefit of current buoyancy in the market. 9.112 The Committee sought information on the action taken by the DPE and the Government on the outcome of these meetings. The Committee seeks DPE to apprise it on Revised Estimates and Supplementary Demands. The Committee directed the DPE to give its comments on the Committee’s queries, observations and recommendations contained in this Report. (J) 169th report

9.113 The Committee observed that many of the PSEs, however had not been able to retain their original position in the market and withstand the global competition in the new liberalized economy. The Committee noted that most of the companies under major conglomerates like BBUNL, BYNL, HMT, AYCL, with diversified business in heavy engineering, were making losses. These companies rely on major Government projects for orders to generate working capital. The Committee felt that these engineering conglomerates have critical potential for the capital goods sector in the country and need to be re-aligned to the larger market. The Committee liked to know of the measures that were being considered in this respect for these companies. 9.114 The Committee observed that the Government has to take necessary steps to reduce the dependence of PSEs on Government for finances and orders; Professionalise the Boards of the PSEs, in the spirit of Government’s policy leading to more and more autonomy and enter into MoU agreements with more companies, setting out elaborate objectives for better results. The Committee observed with grave concern that the PSEs under DHI have been incurring huge aggregate losses that not only eatup the aggregate profits earned by few companies but also burden the exchequer with huge net losses. The Committee was more worried as the losses were increasing year after year. The Committee impresses upon the Government to not only arrest the decline but also reverse the trend so that loss making companies could also earn profits. The Committee also desired that it may be apprised of the specific steps taken in this regard.

9.115 The Committee recommended that the public sector enterprisess should have been encouraged and advised to gradually and increasingly compete in private sector projects as more and more sectors have been opened up for private sector. PSEs may be given preference for Government orders but it does not preclude them from exploring larger market domestically or globally. PSEs must have not been be allowed to suffer due to drying up of Government orders. In any case, by supplying the Government orders practically does not

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add anything to the Consolidated Fund of India. It was only ‘Deemed Earning’. The Committee recommended that with the opening up of the economy and WTO regulations coming into force. PSEs must have made use of new opportunities by entering into JVs and marketing tie-ups to enter into larger global market. The Department should have been have issued specific guidelines to its PSEs to explore export markets. 9.116 The Committee further recommended that diversification of market should have been incorporated as one of the significant factor in MoU rating of the PSEs so as to encourage them to explore new market. The Committee recommended that the Department of Heavy Industry must evolve a strategy, as an integral part of revival schemes for PSEs to promote exports given the country has a well-laid capital goods sector.The Committee noted that the growth in exports was hindered due to non-availability of adequate supplier’s credit to buyers, higher rates of interest and lower duration for which the credit was available. The Committee recommended that the Government must have taken a favourable view of the proposals made by the Department of Heavy Industry with regard to availability of adequate supplier’s credit to buyers, low rate of interest and longer duration of credit to facilitate growth in export performance of the PSEs. 9.117 The Committee observed that while the aggregate growth in PSEs under DHI compares well with the capital goods growth, but this level of growth was mainly contributed by one PSE namely Bharat Heavy Electricals Ltd. (BHEL) which showed a growth of 15% during this period. Most of the PSEs have shown a negative growth mainly due to financial, marketing and technological constraints. 9.118 The Committee apprehended that despite robust growth in capital goods sector, the PSEs find difficult to secure orders and in several cases to execute the orders due to lack of working capital and other constraints. The Committee, accordingly, recommended that efforts should have been made by the PSEs to utilize current opportunities in the market. As the capital goods market was essentially technology-intensive, PSEs must undertake the technology upgradation to secure high-end market. The Committee therefore, recommended that the Government should have decided the on linkage between BIFR and BRPSE at least, till such time a final decision on BIFR was taken by the competent Court. The Committee also observed with concern that multiplicity of agencies even in deciding the revival may and has resulted in differences in opinion, successive appeals and costly delays. Even after deciding, the revival packages had failed in several cases. The Committee apprehended that in the process of analyzing the cases the BIFR has assessed the Techno-Financial feasibilities of individual PSEs prepared by expert agencies. Yet the appeals were filed in AAIFR and High Courts/Supreme Court and now these may further will be referred to new BRPSE for appraisal before a final decision was taken by the Cabinet. The entire process was time consuming and costly. The cost of delay had been immense in terms of rising liabilities that have eaten up the net worth of the PSEs. It might have been an effort in duplication.

9.119 The Committee recommended that the Department must take steps to expedite the decision and implementation for the PSEs’ sustainable revival. Accountability must be fixed for the successful and sustained revival once case was decided by the competent authority. The Committee further recommended that the Government should inform the Committee of the revival packages approved by the Cabinet before approaching the Parliament for Supplementary Demands. The Department must also give a post-revival SWOT analysis of the PSEs and that must reflect its Technological strengths and market viability. 9.120 The Committee noted that the expenditures were classified into two parallel categories Capital/Revenue expenditures and Plan /Non-Plan expenditures. These two parallel categories were curiously hybridized into four supposedly distinct categories of expenditure. The Committee could like to know the rational principles for such classifications and sub-classifications, instead of description of expenditure under these categories. The Committee was of the view that existing classification heads needs further rationalisation and desired that the Government should review the same. 9.121 The Committee desired to know that on what ground the Planning Commission’s approval was sought for certain Revenue and Capital expenditures leaving remaining sizable Revenue and Capital expenditures unapproved. If any guideline was followed in this respect. The Committee liked to be appraised on such a categorization in the Budget. The Committee also desired to know if such segregation was scientific and does not affect the efficiency of expenditure. Further, the Committee liked to have a comment from the Department, if there was need improve the Budget scheme.

9.122 The Committee observed that the character and nature of the expenditure was too diverse to be kept under same sub-category. The Committee was not convinced of the classification of such varied expenditures like R&D projects and Modification of Offices being kept under the same category of expenditure as Plan-

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Revenue Expenditure. Such classification appeared to be unscientific. The Committee liked to have Department’s comments on the need for a more rational classification. 9.123 The Committee observed enhanced allocations for almost all the PSEs for the renewals/replacements, additions, modifications etc. However, the Committee notes several allocations were of Rs. 1 lakh. The Committee observed with concern if any sustainable purpose could have been served with such meager Plan Capital allocations, particularly keeping in view that similar allocations were made the previous year too. The Committee recommended the allocations for the renewals/ replacements, additions, modifications etc. should be judicious and should have justified by the objectives it was likely to achieve. Allocations should not be for mere token symbolism as it may amount to blocking scarce resources, which the country could only ill-afford. The Committee was informed that such allocations were necessary for the technical requirements of budgetary process. The Committee felt that such small amount obscures the entire scope and scenario of prospective expenditure. The Department might avoid blocking such amounts in future. 9.124 The Committee observed that there was multiplicity of allocations for similar purposes. Apart from allocation for Plan Capital expenditures to individual PSEs, there were allocations for Crucial Balancing, for addition/modification/ replacement and for restructuring the PSEs. Also Rs. 150 crores was allocated as lump-sum Non-Plan Capital expenditure for the revival of the PSE. The Committee liked to know if there was any significant qualitative difference between these categories of expenditures for which distinct allocations were made. If, not, Government should have found out the way how this multiplicity could be avoided, even if by clubbing such allocations together. The Committee further observed that there were too many lump-sum allocations for Plan-Capital expenditure that have not been sufficiently elaborated. The Committee has been further informed that these allocations were liable to be raised at the subsequent stages. The Committee should have been apprised if such unexplained expenditure that could not be estimated, could at all be Planned-Capital expenditure. 9.125 The Committee recommended that the lump-sum expenditures should have sufficiently elaborated for Parliamentary approval in future. The Committee was in agreement with the allocation made in respect of specific project with BEML. The Committee could however, like to know the terms of agreement, if any. The Department had been closely associated with the promotion of Automobile R&D facility in the country. However, a significant Grant in Aid of Rs. 25 crores to R&D institution was still treated as a Non-Plan-Revenue expenditure along with Secretariat expenditure and Interest subsidy. The Committee observed that the character of expenditure was too diverse to be kept under similar category. 9.126 The Committee noted with grave concern that out of the total allocations of Rs. 861.32 crores, more than Rs 400 crores were Lump-sum allocations. Last year too similar allocation of Rs. 400 crores was made. Such a practice undermined the principle of Parliamentary scrutiny of Budget. The Committee took serious note that against the total investment of Rs. 8590 crores and projected outturn of Rs. 15363.65 crore in 2005-06 the earning from dividends and profits could be meager Rs. 69.63 crores, which was around 0.45% return on the outturn. Even of this amount a BHEL was the largest single contributor. Further more the Revenue receipts were likely to go down even further this year. Against the anticipated Revenue receipts of Rs. 190.55 crores in 2004-05 the projected Revenue receipts for 2005-06 were likely to be meager Rs. 76.48 Crores. The Committee observes that it was not a healthy situation and directly related to the performance of the PSEs. The Department of Heavy Industry has to make concerted

9.127 The Committee was concerned that PSEs were not able to pay their Guarantee fee to the Government on the contrary Government has to provide a subsidy on Guarantee fee. The Committee desired that Government should take suitable steps in this regard. The Committee viewed such a trend as an unviable drag on the Government’s scarce finances. The Government was not earning sufficient dividends on its investments in the PSEs rather it was loosing money on the loans it had lent to the PSEs. Instead of charging the Guarantee fee the Government was supposed to subsidize the Guarantee fee on the finances raised from the banks and financial institutions. The Committee desired that the Government should have taken appropriate measures to stop this trend. DHI should prepare a time-bound strategy in this respect. 9.128 The Committee feels that the issue of payment of Guarantee Fee Subsidy needs to be re-examined in view of the fact that the PSEs which were not able to even pay for Guarantee fee to the Government, how could they settle other liabilities. The Committee could also like to know Department’s comments, if it was necessary to give Guarantee Fee Subsidy to same PSEs that utilized the facility even last year. The Government may also inform about the purpose for which the resources were raised against such guarantee. The Committee noted with constraint that out of 34 PSEs that were still functioning under the Department, as

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many as 27 were entirely dependent on the budgetary support from the Government. Of the total outlay to the PSEs, 54% was generated through budgetary support. The Committee found this to be a telling comment on the precarious financial conditions of the PSEs as the commercial enterprisess. 9.129 The Committee observed that cement and non-metallic industries were not able to generate extra-budgetary support. in the engineering and consumer industry sector only BHEL and HPC were able to garner extra budgetary support to some significant level. Whereas the generation of resources by rest of the companies, was nominal. This was certainly not an acceptable situation. The DHI should have come out with concrete proposal so that not only the number of companies who generate the internal resources increases but also these Companies generate substantial resources. The Committee however recommended that companies must be encouraged to garner extra-budgetary support. The PSEs should have advised to seek their funding needs from Banks/Financial Institutions as extra budgetary resources. The policy of the Government should have been have been to provide PSEs as minimum a budgetary support from Government as possible. At the most Government guarantees could be provided to enable the PSEs seek funds from Banks/Financial Institutions. Even in revival cases, the PSEs should have been advised to obtain institutional finance wherever feasible.

9.130 The Committee further recommended that instead of relying solely on budgetary support, the government should seriously consider to raise finances for reconstruction of PSEs, from market through an IPO of which government could be the promoter with employees having the option of preferential shares. The management of the company will be accountable to market and the shareholders and, therefore, could be autonomous to a significant extent. Such an IPO should have been have wider public participation in the reconstruction of PSEs with employees as major stakeholders having the preference. Budgetary resources thus saved should have committed for clearing the dues of VRS/VSS optees. 9.131 The Committee took note of the view of the DHI that the PSEs might have disposed of surplus assets particularly to fund their own revival plans. The Committee was of the view that the Government should be cautious while doing so. It was suggested that Government should draw a policy or a guidelines for all the interested parties and stakeholders in this respect. The Committee observed with concern that every year during past few years the non-plan expenditure has been higher than plan expenditure. Last year at the RE stage the non-plan expenditure increased while the plan expenditure declined. The Committee welcomed the higher plan allocation in 2005-06 as compared to last year and hopes that the Department could be able to utilize the money. The Committee felt that the Government should have also made efforts to reduce non-plan expenditure.

9.132 The Committee viewed that current regime of lowering the customs and increasing the excise duty on items like steel will have serious implications for the PSEs in capital goods sector. The Committee cautioned the Government that such a duty regime could result in an uneven competition with PSEs facing serious handicap against cheaper imports and MNCs. If the Government was serious about reviving the PSEs, it must help them regain their standing in domestic market instead of imposing a duty regime that perpetuates the disadvantage against cheap imports. It was the responsibility of the Government to seek redressal, if necessary, against such an uneven competition under the WTO provisions.

9.133 The Committee recommended that the benefits of the Notifications No. 50/96 & 51/96 should not discriminate against the premier R&D institutions like ARAI for nuances. The Committee directs the DHI to pursue the matter with Ministry of Finance.

9.134 The Committee recommended that both the R&D projects namely Coal Gassification Project and FCRI must be supported till they achieve commercial viability. The Committee observed that the fast pace of technology developments and obsolescence has left very little choice on technology front for developing countries like India. The Committee therefore desired that the Government should ensure the development and commercialisation of new technologies. The Government should come out with a policy providing for technology upgradation in general and the PSEs in particular. 9.135 The Committee took serious note of the fact that the budgetary allocations do not sufficiently reflect the concern for technological upgradation of PSEs and R&D which has direct bearing over the efficacy of the Companies keeping in view that PSEs were established as pioneers in industrial technology. The Committee felt that the Government should actively involve in the technological upgradation of PSEs and if necessary extend the financial support.

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9.136 The Committee was of the view that the Department has still not prepared a detailed strategy for the reconstruction of PSEs including their technological upgradation. Allocations for revival were still ad-hoc in nature for immediate purposes. The Committee recommended that regular technology audit must be conducted by agencies like DSIR or other resource agencies to assess the technology update of the PSEs. 9.137 The Committee noted that the Chinese model, where the technology transfer to a domestic manufacturer was mandatory for an MNC to get an order in that country, could be an effective policy in facilitating technology transfer. China was successfully leveraging its market access to foreign manufacturers, to acquire technology and ensure that a significant share of the equipment of strategic economic importance was manufactured locally in China. Similarly, the Bhoomiputra policy of Malaysia has been evolved within the WTO framework to ensure technology transfer in manufacturing industry and a similar approach could improve the access for the latest technology for the Indian Industry. The Committee liked to have the view from Government that in order to bring about the technological revival of the PSEs one of the important issues was, if the foreign companies securing large contracts in India, could be obliged to associate competent local companies for technology transfer, as was the policy in some other developing countries such as China and Malaysia. 9.138 The Committee further suggested that in order to ensure that the PSEs gain from technology alliances it was necessary that strong learning capabilities were built up to facilitate skill acquisition, internal training. The receptivity in the PSEs also have to be built up to accumulate, retain and transfer of knowledge to take the full advantage of the Joint Ventures or any other technological alliance.

9.139 The Committee recommended that the PSEs could be effectively used for the creation of infrastructure and promotion of skills to capitalize on our competitive advantage.

9.140 The Committee recommended that the Government should consider the following policy initiatives to facilitate technology transfer to capital goods sector:

(i) Issue suitable technology transfer policy guidelines so that for all capital goods and services any foreign vendor desirous of supplying the same in the domestic Indian market must necessarily source at least 30% of the proposed bid from local companies within India. Moreover, the foreign vendor must also give an option for transferring technology to the desirous and capable local company for critical equipment and service involved in the project/product.

(ii) Enhance bilateral/multilateral co-operation with developed countries for state of art

technology transfer and exchange of technical experts in the areas of emerging technologies.

(iii) While granting FDI approval for trading/sale service, wherever there was a provision for

setting up a manufacturing facility in due course with adequate investment, a clause should be incorporated and implementation monitored meticulously for materialization of such investment on a time bound basis.

9.141 The Committee observed that the restructuring exercise should now involve a major strategic repositioning of the company’s competitive focus so as to enhance its value and to strengthen it adequately to compete effectively by improving its resilience and the earning potential. The Committee recommended that the Companies must re-align with the market, identify and create niche in the market. This could required comprehensive marketing strategy, techno-value addition of products-profile and diversification of market. The Committee observed that the revival effort should aim to optimally allocate resources to ensure the increasing returns over the long run by improvement in the innovation and implementation capacity and increasing its reserve capacity to meet the challenges of the market driven globalized economy. 9.142 The Committee recommended that the objective of the restructuring effort should be:

(i) Improvement in the innovation ability of the PSEs by: strengthening the R&D and

technology management and absorption.

(ii) Improvement in implementation capacity by: improving the management knowledge and skills, marketing skills, product quality, and technology familiarity.

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(iii) Reduction in the vulnerability by improving liquidity and cash flow coverage.

9.143 Furthermore, the restructuring exercise should include:

(i) Operational restructuring by modifying production process by bringing economies of scale, improving the level of the quality and improvement in the process technology. Technological upgradation to target the high-end market.

(ii) Marketing restructuring by repositioning and diversifying the marketing and the

distribution channels. (iii) Financial and capital restructuring to increase earning power of the company that may

entail increased reserve capacity, bank ability and ability to generate extra-budgetary resources.

(iv) Organizational restructuring to motivate performance and formulate a long-term

objectives in accordance with the projected trends of market. 9.144 The Committee liked to know the comments and the concrete, tangible action taken or to be taken by the Department on these steps. The Committee noted that the Jharkhand Government has refused the proposal to convert the assets into resources. The Committee took serious note of the clear disjoint in the policies of Central and State Governments that has seriously affected the prospects of the Company. 9.145 The Committee directed the DHI to take up the issue to removing bottlenecks with the Government of Jharkhand and inform the Committee of the outcome. The Committee noted the diverse range of business in which Subsidiaries of the BYNL were involved. The Committee also notes despite repeated recommendations by this Committee and other expert studies to merge the subsidiary Companies into single entity; no initiative has been taken in this respect. The Committee could like to know the view of the Government in this respect. The Committee also noted that of the seven Companies, five have been referred to BIFR. Of the seven companies only Bridge & Roof was earning profit. Appeals against BIFR’s decision in respect of R&C and TSL were pending before AAIFR. The Committee also noted that the Companies under BYNL group were being placed before BRPSE in phases. The Committee hopes that BRPSE could expedite the matter. 9.146 The Committee noted that accumulated loss of BYNL during 2003-04 was Rs. 1001.50 crores. The Company with a paid-up capital of Rs. 186 crores has had a negative net worth to the tune of Rs. 838.36 crores in 2003-04. The Committee directed the DHI to apprise the Committee of its course of action. The Committee noted with grave concern that the financial parameters of the holding Company and five of its subsidiaries were dismal. The Companies that have been referred to BIFR were still waiting for revival or otherwise. 9.147 The Committee noted that the Company’s productivity and profitability suffers from old machinery causing frequent breakdowns and high rate of rejections. The Committee, accordingly, recommended for urgent upgradation of technology and machines and hopes that the revival plan could take care of this aspect. The Committee recommended to the DHI to assess the profitability prospects of TCIL and if satisfied, assist the Company in regaining its financial viability. The Committee recommended that Government must have supported the Company’s resource and technology requirements to harness the potential of non-conventional energy in the country. The Committee was of the view that the Government must help this sector in attaining the economies of scales. The non-conventional energy could be economically feasible for the community-based consumption in obscure villages and remote areas where the cost of energy transmission was high. The Non-Conventional Energy sources could have been cost-effective supplementary source for energy needs of small habitats and clusters. 9.148 The Committee recommended that constraints faced by BHEL, needed to be addressed by the Government with a favourable view to support this flag-ship company that was financially self-reliant but facing uneven competition due to the policy structure. The Committee observed that the Budgetary scheme and explanatory notes on expenditures do not give sufficient explanation/details of the allocations. There was always a possibility of duplication of expenditures through multiple Heads. The test criterion of the budget was clarity and transparency instead of ambiguity. The objective of the parliamentary scrutiny of budget was to know efficacy of the objective and efficiency of expenditure to achieve the objective. Expenditures were

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split into classes and sub-classes, thereby preventing a clearer picture of expenditure for a particular objective. The Committee liked to know the rational necessity and objective criteria of the classification of diverse expenditures under one category and Budget Head instead of the details of allocations. The Committee felt that the DHI should take up these issues for consultation with the Ministry of Finance. 9.149 The Committee noted that DHI was unable to commit on firm and tangible long-term objectives in quantitative terms that could be a benchmark against which the performance was assessed. On most of the long-term issues Department’s reply had been elusive. The Committee observed that despite huge financial liabilities all the major decisions were still left to BRPSE. Pending its recommendations being approved by the competent authority, the Department was taking measures that were ad-hoc window-dressing of depleted worth of PSEs. The Committee was of the opinion that scarce resources could not be lost endlessly amidst huge liabilities of PSEs. A lasting solution had to be found urgently and accountability must have been accordingly fixed for which it was necessary to determine the benchmarks of performance. 9.150 The Committee recommended that the Department should formulate a road map for the consideration of Government on the major challenges faced by PSEs like obsolete technology and lack of marketing strategy. The Committee also suggested to take into account the cumulative cost of delay, previously due to pendency of cases under BIFR regime and now under BRPSE in finalizing a decision on PSEs. The Committee observed that the multiplicity of agencies involved had led to inefficient delays in finalizing revival. The Committee was of the view that steps must be taken to reduce multiplicity of agencies in preparing, assessing and revival proposals. DHI had the mandate to promote the development and growth of capital goods and engineering industry in the country, which in turn has critical bearing over the infrastructure development in the country. However, plight of the PSEs urgently required an expeditious and consistent action by the DHI instead to postponing the decision on successive series of multiple bodies. 9.151 The Committee noted that while the PSEs in the heavy engineering and capital goods category were facing the constraints due to lack of orders mainly from Government and competition from foreign companies due to opening up of domestic market. Heavy wage bill, inability to generate internal resources or extra budgetary resources due to huge liabilities and previous NPAs, over reliance on the budgetary support even for working capital and also for the orders, inability to upgrade the product line according to market needs, technological drawbacks, lack of corporate dynamism, inability to create new niche in the market or locate new market were the major constraints for any sustainable revival of the PSEs. The Committee, therefore, recommended that technological upgradation, upgrading the product line according to new niche market and identifying new domestic and export markets have to be the cardinal elements for a sustained viability of the PSEs. 9.152 The Committee recommended that certain Companies in capital goods sector were critical for development of heavy engineering and infrastructure sectors irrespective of their financial condition. These Companies in any case relied heavily on the Government’s investment in huge infrastructure projects. While they could be encouraged to generate their internal resources through innovative corporate strategies like global tie-ups and JVs. Government must at the same time support such facilities. 9.153 The Committee could like to suggest to the Government to consider the critical utility of any Company before deciding on its sustainable and comprehensive revival/restructuring instead of going only by their precarious financial condition. The criticality will depend on long-term prospects of the Company in terms of technology spin-offs and self-reliance in mega-machinery in strategic areas. The Committee recommended that DHI should have apprised it of the Revised Estimates and the Supplementary Demands.

(k) 170th report

9.154 The Committee understood that the creation of an independent Ministry of Agro and Rural Industries has reinforced and strengthened the functioning of the ARI sector as a whole, by highlighting its present status and ensuring timely policy interventions needed. The Committee recommended that the Ministry of ARI should further streamline and strengthen the ARI sector by ensuring timely and adequate delivery of credit, technology up gradation, marketing support in the form of financial support as the mandate of the Ministry of ARI.

9.155 The Committee was of the view that all efforts should have taken to achieve the targets set for employment generation under REGP, KVIC and PMRY. Efforts should also be taken that targets under these scheme were evenly distributed throughout the year.

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Monitoring mechanism

9.156 The Committee was of the view that ARI sector could contribute to the national economy in terms of production and employment generation through setting up of village industries in the rural and semi-urban areas. The efficacy and effectiveness of the schemes largely depended upon intensive review of implementation of the schemes of KVIC, Coir Board and the PMRY. The Committee was constrained to express its displeasure over the provision of inadequate budgetary support to Ministry of ARI as the projected demand was to the tune of Rs 1150.10 crore against which Rs 859.00 crore has been provided. The While in PMRY, the budget allocation was same as proposed i.e, Rs 174.20 crore, in case of REGP the budgetary allocation (Rs 475.00 crore) was Rs. 63 crore less than the budget proposed (Rs. 412.00 crore). The committee was of the considered view that since ARI had potential for generating more employment opportunities in the rural areas and small towns, the Ministry of ARI must have vigorously and effectively take up the issue with the Planning Commission and the Ministry of Finance urging for additional allocation as per requirement at RE Stage. Prime Minister’s Rozgar Yojana

9.157 The Committee recommended that the Ministry of ARI and Ministry of Finance should have been have ensured the optimum utilization of funds under the PMRY Scheme by basing the release/utilization of funds under the Scheme on performance/achievement of target by the State/UTs. The funds released to State/UTs should have been expensed during the same year. Progress/achievement under the PMRY scheme 9.158 The Committee was constrained to express its displeasure over the pathetic performance of PMRY in the States of Jharkhand, Bihar, West Bengal and Maharashtra, although slight improvement has been there during 2004-05 as compared to the last year for the corresponding period. Although, the Committee notes the submission of the Ministry of ARI that the performance of PMRY in these States has been further accelerated after the visit of the Standing Committee on Industry, it was desirable that Ministry of ARI in tandem with the Ministry of Finance, banks and state Government should keep monitoring over timely and effectively implementation of Schemes under its purview.

Status of recovery of loans under PMRY

9.159 The Committee desired that the banks in the post -sanctioned phase should have monitoring provision for making the success rate of the projects under PMRY higher for better rate of recovery under PMRY which was around 34.9 per cent, 35.2 per cent and 34.96 per cent for the half year ending March 2002, 2003 and 2004. The Committee desired that public sector banks must yield to the guidelines issued by the Reserve Bank of India in regard to disbursement of loans on the PMRY. The managers at the top level should also direct the branch managers to adopt client-friendly approach and create such atmosphere that the general opinion about the mindset of the bankers should itself change. It was possible through making PMRY more popular among the unemployed youth. The Committee commented the role of RBI for suitable intervention from time to time whereby the RBI issued guidelines for consumer/client-friendly working of banks. In an working environment when the financial and banking reforms was continuously operating in the globalized scenario and the banking sector was being empowered with functional autonomy, the onus/lies on the public sector banks and its administrative Ministry to implement the guidelines of RBI in the best interest of the industries. The reason behind imparting functional autonomy was to serve the nation and not use this functional discretionary for denying the prospective entrepreneurs in harnessing the opportunity for contributing to economic growth and industrial development. Causes of rejection of applications for loan

9.160 The Committee desired that the financial institutions, respective State Governments and the Ministry of ARI should have coordinated and monitored the working of PMRY in such a way as to enable the process of sponsoring, sanctioning and disbursement of applications by the States and banks by avoiding the stoppage/delay of disbursement in PMRY on flimsy grounds and for quick disposal of application on the part of DICs and forwarding the same to the banks. Adequate mechanism might have been adopted for timely communication of targets to the banks for necessary action on their part; coverage of SC\STs/OBCs under the scheme as per the norms stipulated by the Government of India; effective orientation programmes conducted by DIC for the target groups at block/taluka level to enlighten/popularisation of PMRY and giving accordance

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to the provision of PMRY for advancing loans in the ratio of 50%; 30% and 20% in respect of industry, service and business sector. 9.161 The Committee was pleased to note that the recommendation of Parliamentary Standing Committee in its report on Demand for Grants for 2004-05 regarding increase in the subsidy and ceiling levels for loans under business and industry category were under active consideration of the Government, however, the Committee desired that Government should expedite the process of its active consideration on the issue.The Committee desired that the Ministry of ARI and the financial institutions could undertake intensive assessment of SWOT analysis on working of PMRY and make out strategy for making the scheme successful. Khadi Industries

9.162 The Committee understood that Khadi had been the mode of national identity since the days of India's struggle for Independence, therefore, all programmes for the furtherance of Khadi could have amounted to enhancing the national culture, traditions and identity. On this ground, the two major components of Khadi programmes i.e. the rebate and interest subsidy was totally judicious (Rs.73.10 crores in 2004-05 and Rs.75.00 crores in 2005-06 as rebate on retail sales of Khadi and Rs.24.04 crores in 2004-05 and Rs.25.00 crores for the financial year 2005-06 as interest subsidy on bank finance for Khadi working Fund). However, the Committee could have liked to stress that Government should allocate more fund for R&D in the Khadi field as the actual expenditure remained confined to the tune of Rs.0.22 crore during the year 2004-05 as the more and more R&D activities could have led to reduction in the cost of production; product development/modification and diversification enabling the Khadi product to compete with others in the market.

9.163 The Committee could have also liked to give a word of caution to the managers of Khadi of industries that since we were living in the WTO regime, therefore, Khadi Industries should have now started to think to stand on its own without depending upon rebate and subsidy. Such caution as recommended by the Committee was based on the ground realities indicating the need for preparing the Khadi Industries self sufficient and competitive.

9.164 The Committee acclaimed the status of West Bengal for ranking the top position in the muslin Khadi production singularly contributing 55% of total national production of Muslin Khadi in the KVI sector. Not only this, Muslin Khadi attracted large scale employment of women artisans which provides additional opportunity for empowerment of women. However, the Committee could have liked that the State must have continued to be an ambassador of India's culture and traditions and unique art and craftsmanship of the state such as Mulberry Cocoon of Malda, and Muslin Khadi of Nadia and Murshidabad must continue to dominate the global market harnessing not only the foreign currency but also fostering India's enriched culture to the world civilisation. But, to translate such rosy aspiration into reality the state government and the Central government had to work hand-in-hand coordinating and implementing the programmes with utmost honesty and sincerity. 9.165 The Committee was of the opinion that since Maharashtra had been the capital state for economic activities, it was utter surprise that out of one hundred three khadi institutions, eighty two khadi institutions felled into the 'D' category, not only this but the irony went beyond being Maharashtra having the economic capital of India that even the national institute to promote and proliferate the Khadi programme i.e. KVIC was located in Mumbai. The Committee had been aware that KVIC was itself under going structural and functional restructuring, of course KVIC must have underwent such exercise as the pathetic condition of reeling Khadi industries was reining directly under its nose, therefore, it was expected that the over hauled KVIC, with whatsoever nomenclature it wears, could also initiate appropriate steps for improving the Khadi industries in Maharashtra were Khadi was doing its business worse than so much denounced Bihar where 61 our of 94 KVIC/ KVIBs institution were in 'B' category and only nine, that too of KVIC institution were in 'D' category. The Committee felt that the Ministry of SSI had very recently conducted the Seminar on the importance of performance and credit rating of SMEs which could have long bearing on the borrowing capacity of the enterprisess could have also have bearing on ARI enterprisess, therefore, the Ministry of ARI should intervene on appropriate direction should have been issued to chalked out action plan for promoting and proliferation of Khadi Industries in the State. 9.166 The Committee was of view that Bihar, after the partition and separation of Jharkhand, remained basically an agricultural state, that too not very organised, and the state being bereft of any large scale or even medium scale industries, the only option that remained with the state was the accelerated promotion and

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proliferation of agro - rural industries and Small Scale and Medium Enterprisess which had the benefit of requiring low investment and providing vast potential for employment generation. Therefore, the Committee strongly recommended that the Ministry of ARI and SSI should come together in chalking out district- wise Development Strategy, based on availability of raw material, for promotion and proliferation of agro-rural and SMEs in general and Khadi industries in particular so that the state may come out of its present status and contribute to the national economy. It was also desirable that the people and the Government of Bihar must have prepared for putting back the state on the track. The State Government might been coordinated by the Ministry of ARI for providing basic information for chalking out total planning.

Other Village Industries

9.167 The Committee was of the view that the Government must give the utmost attention to the Village Industries by undertaking serious study of SWOT analysis and outlining the "Key areas for Massive Action" as India being a country of villages and undergoing industrial development must tap the opportunities and bank upon its strength and remove the weaknesses and threats for rapid and ensured rural industrialization and development. Special/specific strategic programme could be sketched out for developing and consolidating village industries in Bihar, Jharkhand and West Bengal, basing the strategy on the availability of local raw material and providing adequate working capital and budgetary support. 9.168 The Committee noted the submission of the Ministry of ARI that KVIC was adopting a strategy to generate large scale employment in rural sector by channelising institutional finance. A Working Group constituted by Planning Commission for the Tenth Five Year Plan had recommended employment target of 89.57 lakh (15 lakh under Khadi and 74.57 lakh under V.I.) by the terminal year of the Tenth Five Year Plan. For this purpose, the Planning Commission has allocated Rs.2080 crore to KVIC. Under its REGP scheme, it was proposed to generate 25 lakh employment by the terminal year of Tenth Five Year Plan. The Committee was of the considered view that an all out efforts should be made for achieving the target set by the Planning Commission. The Committee wished to point out that while combating the problem of unemployment and especially setting the target (that should be determined/ fixed time frame) proper and adequate attention must be paid to population growth rate and the prevalence of level of poverty so that the problem of unemployment, poverty and population explosion could be solved in a time bound frame with a holistic approach. The Committee felt that there was the need for comprehensive and coordinated emphasis for tackling the intrinsic problems of the national economic. The Committee desired the problem of national economy should be tackled through comprehensive and intergraded planning and having coordination and collaboration among Governments Departments/Ministries for effective outcome/result within a stipulated time frame. Of course, the role of private enterprising units could have also been significant in achieving such national goal, therefore, their participation should also be encouraged.

Specific problems being faced by Village Industries in Bihar, West Bengal, Maharashtra and Jharkhand

9.169 The Committee desired that the Planning Commission and Ministry of Finance should have sympathetically considered the cases of Bihar, Jharkhand, West Bengal and Maharashtra where was need to earmarked sufficient fund for the promotion of village industries on fast track. The Committee was pleased to come across that State Level Task Force Committee has been constituted in each State of Bihar, West Bengal, Jharkhand and Maharashtra under the Chairmanship of the Secretary (Industries of the State Government) for better monitoring of the scheme. The Committee desired that at state level nodal officers should have looked after the overall implementation of the schemes and its progress. Marketing strategy for KVI 9.170 The Committee after undergoing the existing marketing strategy of KVIC came to the conclusion that marketing strategy for promotion and encouragement of Khadi and village industries should have been have the following course of action:-

(i) Chalking out suitable strategy for publicity, brand promotion and endowment and product ambassador

(ii) Due impetus to marketing research and survey and product diversification as per the finding of market research

(iii) Identifying private marketing channels and popularization of CFCs with motivational schemes and self promotional schemes.

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(iv) Modernization of existing outlets and channels and facilitating basic marketing infrastructure (v) Appointment of Marketing professional for promoting the KVI products and

encouragement to Franchise scheme (vi) Adoption of aggressive marketing by newly constituted marketing confederation Targeting

governmental Department/Ministries (vii) Effective implementation of (PRODIP)

Organizational-functional Restructuring of KVI 9.171 The Committee expected that the Ministry of ARI could have examined the recommendations of the Expert Committee within a specific time-frame and suitable recommendation which were accepted by the Ministry could be implemented in a time-bound manner. The Committee desired that the Ministry of ARI could furnish the Committee the report of the Expert Committee along with comments of the Ministry on the recommendation contained therein and the possible impact on the structural and functional pattern of KVIC. It was now the time for KVIC to deliver. It was being hoped that the revamped KVIC with new structural and functional pattern could have been in a better position to serve the KVI sector in a more professional and effective manner.

Coir Industries

9.172 The Committee was in agreement with the allocation with the Plan expenditure under Major Head 2851 which primarily meant for implementation of S&T activities and R&D activities though various collaborative research projects and the development programme of the Board in the major areas of promotion of domestic market, promotion of export marketing; employment generation; development of traditional coir industry in non traditional zone; training and HRD and propaganda, publicity and welfare measures of coir workers. However, while having the close examination of scheme-wise appropriation of plan allocation (Rs.15.20 crore at BE 2004-05 was enhanced to Rs.16.27 crore at RE stage) but to the utter surprise of the Committee the actual expenditure during the year (upto 4th March 05) remain confined to Rs.12.62 crore. The Committee was constrained to express its displeasure that despite the toll claims of Ministry of ARI for having resilient and foolproof Monitoring mechanism the actual plan expenditure under Major Head 2851 allocated to coir industry remained short of plan allocation made at RE stage by more than 20 per cent. Obviously, the plan allocation was meant for such significant purpose like S&T activities, export promotion, domestic market promotion and development of production infrastructure, the Committee wondered as how the Coir Board was actually going to promote and market the coir industries/product domestically and globally in the competitive market? The Committee directed that during the financial year 2005-06 all effective measures should have been taken to ensure the hundred per cent utilization under Major Head 2851, then and only then the Coir Industry could be proliferated in the non-traditional zones and dominate the global market. 9.173 The Committee noted that advocacy of the Coir Board/Ministry of ARI for enhanced plan allocation from Rs.16.27 crore in BE 2004-05 to Rs.21.00 crore in BE 2005-06 that the coir sector needed enhance funding for its modernization in tune with the change in the other sectors. Through implementation of the plan schemes it should have been possible to improve mobilization of raw material for fiber production, provide training to coir artisans and workers for their skill development, and also to ensure improvement of infrastructure facilities in various production centres. This could have resulted in better utilisation of raw material and step up production of coir. In the domestic and export market various programmes were envisaged under the schemes mentioned above for popularizing and promoting consumption of coir. The production and marketing efforts could have been supplemented and strengthened through various developmental activities. Efforts could have been continued through scientific and technological research aimed at achieving process efficiency, up gradation of technology, product diversification and new uses of coir. The Committee expected that the combined effect of various programmes envisaged under the Plan schemes could have helped to boost the coir industry. 9.174 The Committee was in agreement with the non-plan allocation (Grant-in-Aid) earmarked to the tune of Rs.2.76 crore in BE 2004-05 which was reduced to Rs.2.62 crore in RE 2004-05 which has further been reduced to Rs.2.51 crore in BE 2005-06. The provision was meant to meet the recurring expenditure of the Board towards salaries and allowances of staff, establishment expenses, contribution to pension fund. The actual non-plan expenditure under Major Head 2851 was to the tune of Rs.2.76 crore in 2004-05 and the total anticipated non-plan expenditure could be to the tune of Rs.5.09 crore. As a matter of fact the total non-plan expenditure were made from two sources i.e. budgetary grant and the departmental revenue of the Coir

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Board. The Committee found that the plan-allocation made under Major Head 3601 to toe tune of Rs. 1.00 crore during 2004-05 and 2005-06 was "too meager" and thus inadequate to meet the objective i.e. release by the Government of India to the State Government for implementation of Centrally sponsored Co-operativisation Scheme for coir industry. The Committee understood that strengthening of Co-operativisation Scheme for coir industries could have gone a long way in the promotion of coir industries both in coir traditional and non-traditional zones. Therefore, the Committee recommended that the Government must undertake the following course of action:-

(i) Plan allocation under Major Head 3601 should have beenbe enhanced from the existing level of Rs.1.00 crore in RE 2005-06

(ii) All components of Co-operativisation Scheme i.e. Share Capital Assistance, Managerial Subsidy, Equipment Assistance and Integrated Coir Development Project must be given equal impetus.

(iii) Coir Board should have been invite and encourage the state government for proposing products under integrated coir development project., so that the budgetary plan allocation earmarked for the purpose was fully utilized.

(iv) Strengthening of monitoring mechanism as adopted by Coir Board and Ministry of ARI over the

implementation of Co-operativisation Scheme

9.175 The Committee was in an agreement with the provision of Rs.0.10 crore under Major Head 6851, which was meant for disbursement of loans and advance to the Board employees for construction/acquisition of houses and for purchase of vehicles.

Status of coir industries in Orissa and West Bengal

9.176 The Committee desired that the Coir Board should have implemented its action plan in West Bengal in letter and spirit and promote the coir industries in Orissa and Jharkhand through various schemes and programmes including Co-operativisation Scheme and the Mahila Coir Yojana so that the prospects of coir industries should have been vitalized in the non-traditional zones

Khadi and Village Industries Commission (Khadi Commission)

9.177 The Committee found that the subsidy in lieu of interest was not actually released to the KVIC but was provided for in the budgetary provision both Plan and Non-Plan for book adjustments, against the interest payable by KVIC to Government. The Committee endorsed the provision made for the purpose. The budgetary provision for interest subsidy as a book adjustment was arising on account of the fact that the sanction of Khadi and VI loan at different points of time over the years had borne varying rates of interest, (varying between 11.8 per cent to 14 per cent) whereas KVIC being a developmental agency for promoting rural employment through Khadi and VI activities has in turn lent to its beneficiaries at zero per cent interest till 16 March 2000 and at 4 per cent afterwards (Khadi Loan) and VI loan at the rate of 4 per cent Per Annum. The subsidy was therefore towards this difference in the rate at which KVIC borrows from the Government and the rate at which it lends to beneficiaries. The Committee found it reasonable that since the amount of interest subsidy had been accumulating every year, the budgetary provision for interest subsidy had been kept at the level of Rs. 39.10 crore to meet the requirements of annual book adjustment. Institutional credit to KVI sector 9.178 The Committee was constrained to express its displeasure that the institutional credit to KVI sector was just 50 per cent to 60 per cent of its requirement. It was all the more disturbing due to the fact that despite the RBI's clear cut and repeated guidelines on the issue the credit flow to KVI sector. Credit flow had remained far short of actual requirement. Therefore, the Committee desired that the Ministry of ARI and KVIC should take up the issue with the financial institution as the priority basis and ensure that the KVI sector get the credit as per requirement. For calculation of the credit requirement of khadi institution it should have been ensured that there should not be any gap interest subsidy value vis-a-vis credit provided by the bank. The Committee recommended that the banks should follow the guidelines of RBI in letter and spirit for the calculation of the credit requirement of the khadi institution as stated under:-

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(i) KVIC will furnish the worksheet for assessment of W.C. (ii) KVIC assessment may be accepted if it does not exceed the assessment made by the banks by more

than 10 per cent.

(iii)In case KVIC assessment of W.C. exceed the bank assessment more than 10 per cent. The W.C. may be arrived at by mutual dialogue between KVIC / institution and financing branch.

(iv)In case of sharp difference between the peak level and lean season credit requirements additional

credit limits may be sanctioned by the banks, KVIC will indicate such peak level credit requirements also in the interest subsidy certificate.

Rural Employment Generation Programme (REGP)

9.179 The Committee observed that Rural Employment Generation programme (REGP) was reaching to its stabilization phase and was almost capable of overcoming its teething problems marked at the initial stage of starting of the programme. The programme was becoming popular with the Bankers as more and more number of beneficiaries were interested to avail finance under the scheme for establishment of their projects. The Committee desired that the efforts should have been made to make REGP a success to generate additional employment in the Rural Industry Sector by facilitating margin money to first generation entrepreneurs financed and under the scheme help should be extended through Backward & Forward Linkages under the umbrella of KVIC. The Backward & Forward Linkages must included EDP training, Marketing support through outlets and District/State/Zonal Level exhibitions for display and marketing their products, Quality Control Assistance, etc. The Committee further recommended for modification in the eligibility criteria for REGP:-

(i) present the lock in period of margin money was for 2 years. It was proposed to extend it to 3 years so

that the sustainability and continuity of project as well as employment could be ensured. (ii) Fiscal concessions in terms of Tax exemption relating to establishment and running of the units,

Octroi exemption, Transport and Power subsidy may be provided at least for 3 years.

(iii) In each backward block of the District, a Rural Industrial Estate may be established with all infrastructure support, so that REGP Units could grow without any hurdles.

9.180 The Committee was apprised that Small Projects upto Rs. 5 lakh were being encouraged, however, the Committee desired that the bank-wise/District-wise targets should be allocated and Sector (Group) wise implementation of REGP be encouraged. Further Social Sector-wise distribution of target, Coverage of new areas uniform coverage of regions/industries, Organizing more exhibitions, Introduction of PRODIP Scheme, Organizing Buyer’s Seller’s meet, involvement of Self-Help Groups in implementation of the scheme must be encouraged. The Committee desired that the role of Ministry of ARI must be more effective in implementation of the scheme in terms of monitoring, coordinating, providing necessary guidance and liaisoning with other Ministry and organizations especially in Bihar, Jharkhand, West Bengal and Maharashtra, where aggressive popularization of the REGP was required. Setting up of Monitoring cells at Regional /Zonal offices to monitor the progress of REGP 9.181 The Committee endorsed the budgetary allocation as non-plan loan to statuary bodies (Khadi and Village Industries Commission) under major head 6851 meant for house building advance. National Programme for Rural Industrialisation 9.182 The Committee took stock of the fact that NPRI which was announced in the budget 1999-2000 with the objective of setting up of hundred rural industrial clusters in the country every year for boosting rural economy by creating more employment avenues and to arrest the migration of the rural artisans or town / cities. The irony of the programme was that no separate fund was made available to implement the programme and it was conceived that since the various Ministries / Departments were having their own programme in this "coveted areas and their co-ordination and synergistic harnessing could be significant / harness the objectives of the programmes. The result that came out was that the expectation regarding the success of the programme felled apart, and that was bound to happen with the programme without financial

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support, as in total, an amount of Rs. 19.9 lakh only has been sanctioned under NPRI scheme from 2001-02 till 2004-05 for development of clusters (19 clusters for a particular region) in the length and breadth of whole India. The co-ordination and synergetic approach so conceived among various Government Ministries / Departments to make NPRI a success could not succeed the test of the time and the administrative (Ministry of ARI) which was supposed to implement the NPRI spent no time in screwing the bureaucratic skill for advocating the countless reasons for "unsatisfactory performance of NPRI i.e. meager financial assistance of Rs. 5.00 lakh for lakh per cluster for wide intervention, fill in gap arrangements, non-availability of credit linked subsidy component and also the inadequate synergy with the Ministries / Departments with their own scheme in this area. When this Committee recommended for comprehensive over hauling and synchronization of all schemes and programmes for employment generation and poverty alleviation, it the Ministry of ARI who beautifully referred the allocation of transaction of business among various Government's Ministries / Departments with a stress that sufficient co-ordination and synergy exists among various Government's Ministries / Departments. The Committee wondered as how the same Ministry of ARI was now wanting out the lakh of co-ordination and synergy as the reason for unsatisfactory performance of NPRI. This Committee was of the view that logic and argument of the Ministry of ARI was of selective nature. 9.183 Regarding NPRI, the Committee on Industry observed that NPRI had the potential for actual rural industrialization and consideration of rural economy and in its Report on Demands for Grants (2004-05) had recommended the Government should undertake concrete measures to combat the problems in achieving the objectives, targets credit-flow, implementation and monitoring mechanism and "Key Concern areas" of NPRI. But of no avail. Sensing the slow but sure death knell of the NPRI, the Ministry of ARI had now decided to abandon the so acclaimed programme (NPRI) and the Ministry came out with re-christened programme, coincidently, the name of the programme was SFURTI, Scheme of Funds for Re-generation of Traditional Industries. NPRI had made a slow start, therefore, it seems that the name of the new programme was carefully drafted as SFURTI, obviously to instill the hope among those who was using their heart in the efficient working of the Government machinery. The Committee was awfully shocked to observe the pathetic working of the programmes / schemes and the monitoring mechanism as maintained within the Governmental structure which was being imparted to make the programme a success. The Committee was of the considered view that re-christening of schemes was not the guarantee to make the new scheme a success unless and until the scheme was back by adequate financial fund and willing administrative backup to deliver in the system. The Committee had no objection with launching of new programme like SFURTI or with whatever names it came in future but the Committee strongly felt that NPRI had cherished national goal and appropriate objectives and had no inherent weaknesses / problems as such except the lack of allocation for a separate fund, the Committee therefore, reiterates that NPRI should have continued in order to achieve those goals / objectives and a separate fund must be allocated to NPRI.

Fund for Regeneration of Traditional Industries

9.184 The Committee extending its best wishes for the success of the scheme for re-generation of Traditional Industries based on cluster development approach and hoped that the programme could have made a head start without further delay as SFURTI had lost one financial year at the drafting / approval stage, therefore, the Committee recommended that the Ministry of ARI should have expedited the process to get the approval of EFC/ cabinet with adequate and required financial support. The scheme might have proved effective in re-generation of traditional industries like coir, handloom, handicrafts, sericulture, leather, pottery and other cottage industries. The committee reiterated that since the artisans were facing various problems including non-availability of timely credit and raw material, lack of market opportunities, it could have been hoped that that the budgetary provision made to the tune of Rs 27.00 crore in the year 2005-06 could have been able to solve the problems faced by the artisans. Moreover, since the Traditional Industries were functioning in the remote rural areas in a most decentralized manner, efforts should have been made for organizing them under appropriate organizational structure. Lumpsum provision for projects schemes for the benefit of North Eastern Region and Sikkim 9.185 The Committee was of the considered opinion that the development of the NER region requires the special attention of the Government because the region had immense potential but due to lack of communication facilities, poor infrastructure, difficult terrain etc. had attributed to the region's economic backwardness. Since the region had lagged behind in progress as compared to other regions of the country, special attention was required to strengthen and reinforce focused implementation of various schemes under the ARI sector. Targets under REGP, PMRY coir industries should have been accordingly set for the region.

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the committee was in agreement with the relaxation in parameters of eligibility which had been made specifically for this region to ensure effective implementation of schemes specially under PMRY. Performance under various schemes in the regions must have been monitored by the implementing agencies at various level both at the Centre and State in order to have effective result.

KVIC's Revamping Activities in the North Eastern Region

9.186 The Committee desired that the Ministry of ARI and revamped KVIC should have not been delayed much (as two years has already been elapsed in making the feasibility study ) in undertaking revamping activities in the North Eastern Region and the scheme on utilization of potential for silk khadi particularly the variety of Endi and Muga Silk should have been done in a time bound manner. Strategy to promote inter-sectoral co-operation and assistance

9.187 The Committee found that each Ministry had been interested with specific mandate and each of them functions on the areas as per the mandate. The Committee also found that Planning Commission coordinated the programmes on various issues. However, governance could have not been water compartmentalized all together in the cases were the areas/issues/concerned were of similar nature or overlap each other as was the case with the ARI sector which has to promote industries in the rural areas and thus generated the avenues of employment generation with the ultimate objectives of poverty alleviation and thus contributing the national economy. Therefore, the Committee was of view that strategy to promote inter-sectoral co-operation and assistance among Rural Development, poverty alleviation programmes, Food Processing sector and other such programmes/schemes with the Agro & Rural Sector in order to give greater thrust and coordinated efforts and synergistic approach towards implementation of rural infrastructural development projects, employment Generation and Rural industrialization & Development and poverty-alleviation. The Government could have adopted the Unified and Integrated Planning System and holistic approach to strike out the very roots of poverty and undertake the implementation of well knitted policies/programmes to develop the rural economy with co-ordinated and concerted efforts, then and only then benefits of the programmes could have percolated down to the targets contributing to "Bharat Nirman".

"Bharat Nirman" 9.188 The Committee welcomed the announcement of the Finance Minister on Bharat Nirman and was of the opinion that the implementation of programmes under Bharat Nirman could have gone a long way forward in developing rural connectivity and infrastructure, thus providing better access to the rural areas. It could have been given a boost to marketing goods produced by rural industries. In fact such initiatives were as much required as subsidy for setting up rural industries. The Committee hoped that the programmes on Bharat Nirman could incorporate also the components of Agro and Rural Industries.

SWOT (strength weakness opportunities and threats) analysis of Agro & Rural Industries

9.189 The Committee was of considered opinion that the role of Agro & Rural Industries might have been crystallized so as to inject competitive edge in the system and process of Agro & Rural Industries so that it could have played pro-active role in national economy and in changing the status of Indian economy from developing to a developed one. The Committee desired that the Ministry of ARI should have been have chalked out Key areas for massive action basing its understanding on the SWOT analysis of Agro Rural Industries and should have been always been guided by Management by Objectives (MBO) and not merely by Management by Activities (MBA). The Committee recommended that the Ministry of ARI should have made strategy to protect the Agro Rural Industries from the adverse impact of globalisation and liberlisation and promote the ARI products in the domestic and the global market by injecting the required competitive resilience under the WTO regime.

Legal framework supporting of the Agro & Rural Industries

9.190 The Committee hoped that the recommendations of the expert Committee on revamping KVIC could go a long way in reorienting the organisational and functional pattern of KVIC for the promotion and proliferation of Khadi and Village Industries. The Committee feels that the Ministry of ARI should have

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serious thought for formulation of National Policy for Agro & Rural Industries for the growth of rural industries, instead of rejecting the suggestion on the first instance. Had the every thing been right with the existing policy measures, India's Agro Rural Industries could have been in a better position contributing the national economy and particularly consolidating the rural economy. The Committee keeping in view that the Ministry through a dynamic process of policy amendments and positioning was consistently addressing policy initiatives in response to the changed economic scenario and its challenges, however, the colossal problem of India was also persisting and that too consistently. Therefore, it was desirable that the Ministry of ARI could have acted and not reacted on the recommendation of the Committee without giving a proper thought to the ideas behind the recommendations.

Problems being faced by Agro & Rural Industries

9.191 The Committee was of the view that Ministry of ARI should have interacted with the concerned sector/department for facilitating infrastructural facilities, marketing linkages and updated technology to the Agro Rural Industries. The Committee felt that the fiscal measures/issues may be undertaken by the Ministry of ARI with the Ministry of Finance to boost investment in Agro and Rural Industries through credit enabled private investment and enhanced public investment effective measures for Agro & Rural Industries for striking an equilibrium for balanced regional growth and overall national economic growth and development. The Committee acknowledged the contribution of ARI sector and awareness of the responsibilities of Ministry of ARI for a balanced regional growth, however, the Committee expected that the Ministry of ARI could undertake effective measures for Agro & Rural Industries for striking an equilibrium for balanced regional growth and overall national economic growth and development.

Employment generation in Agro Rural Industries

9.192 The Committee was of the considered view that there was the tremendous potential for employment generation in the Agro Rural Industries, need was to frame the policy measures and chalking out suitable strategy to harness the inherent potential of employment generation in the ARI sector. In this regard, the Committee desired the Government should have come out with integrated and holistic programme for employment generation and poverty alleviation. Investment - employment generation - enhancement in purchasing power - improvement in standard of living and the consequent poverty alleviation route could root out the inherent problems India's economy. The Committee hoped that the Ministry of ARI should have understood it responsibility towards changing the status of the country from the developing to a developed one and act upon with all efforts. The Committee was of the considered opinion the Ministry of ARI must undertake measures for better co-ordination and collaboration among various agencies/ operating at center, state and district level so that agro and rural industries may be given a look of organized sector where all activities could be carried out/managed by stated objectives and cherished Mission. In this regard, the Ministry of ARI should have been guided by Management by Objectives (MBO )and not merely management by activities. The Committee understood that the Ministry of Agro and Rural Industries was functioning in the rural sector and thus ARI sector could be a party to the "New Deal" for rural India in respect to rural development and welfare and for achieving sustained overall annual growth of generating employment. The "New Deal " for rural India could have benefited to the agro rural industries lead to empowerment of disadvantaged sections of the society. The Committee was of the opinion that suitable steps could have been taken to boost the growth of agro based industries and diversification and development of agro processed products for enhancing it contribution in Bharat Nirman.

(l) 171st report 9.193 The Committee keeping in view that the Small Scale Industries was now-a days on the move world wide, therefore, Small Scale Industries in India could have been given top -priority by the Planning Commission and the Ministry of Finance in plan -allocation so that small scale units might have got adequate space for maturing into medium enterprisess to catch the global trend. The Ministry of SSI could have provided the logistic support to the SSI sector. The Ministry of Small Scale Industries could have strengthened the SSI sector to enable it to remain competitive in market-led economy and generate additional employment opportunities. The Ministry could have assisted the SSI sector in accessing (or provide) proper and timely inputs like adequate credit from financial institutions/banks; funds for technology up-gradation and modernization; adequate infrastructural facilities; modern testing facilities and quality certification laboratories; modern management practices and skill up-gradation through suitable training facilities; marketing assistance; and level playing field at par with the large industries sector.

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Organizational Set-Up and retraining of staff 9.194 The Committee felt that the organizational set-up of the Ministry must be made effective through reorientation of form and retraining of staff to enable them to make full use of the opportunities and challenges fast emerging liberalization and globalization process under post-WTO -regime by undertaking following steps:-

(i) more regular appraisal of policy initiatives for the SME sector in similarly placed large countries;

(ii) ascertaining best practices within the Central Government and also abroad for promotion and development of SME sector and their adoption/adaptation in the Indian SME context;

(iii) closer and more structural interaction with the stakeholders;

(iv) improving synergies among the constituent organization of the Ministry and the Ministry of Agro and Rural Industries;

(v) promoting constructive competitiveness among field-level organizations based on well defined objectives and action plans;

(vi) retraining of staff, as appropriate.

9.195 The Committee was constrained to observe that the Planning Commission has not accorded the financial requirement as projected by the Ministry of SSI to the tune of Rs. 793.94 crore (inclusive of Rs. 3.35 crore for work outlay provided in the Demands of M/o Urban Development for the year 2005-06 ) against which a plan outlay of Rs. 412.26 crores (inclusive of Rs. 3.35 crores of Ministry of Urban Development) has been accorded as a result of which reduced plan allocation could be made to the schemes like Credit Guarantee Trust Fund Scheme (76%) Credit Linked Capital Subsidy Scheme (80%) Technology Up-gradation (16%) and Tool rooms (10%) of their financial requirement causing a serious implication to the promotion and consolidation of Small Scale Industries. The reduced allocation may already affect the implementation of these schemes. The Committee however understood the financial crunch with the Government and the consequent problems being faced by the Planning Commission in judicious and equitably allocation among various Departments/Ministries as per their requirement. The Committee was of the opinion that even the Planning Commission could appreciate the potential of Small Scale Industry in the employment generation and its contribution to the poverty alleviation. It was not a secret that SSI sector was the fate-fixture of common man as the SSI units require low investment but effects the lives of millions. Therefore, the question of resurrection of the SSI sector should have meant the improvement in the standard of living of millions. Moreover, the global trend of promoting the SSI sector was an observable fact. The Finance Minister of India was even tired of stressing the need for providing SSI sector the adequate space to grow and thrive as medium enterprisess therefore, the Committee felt that the Ministry of SSI should have got the sufficient line allocation to implement its schemes/programmes. The Committee was also of the opinion that there was a need for better coordination between the Ministry of SSI, the Ministry of Finance, Planning Commission so that the financial requirement of SSI sector was well communicated to the Planning Commission as per the actual requirement of SSI sector. The Committee strongly recommended that the Ministry of SSI should have taken up the matter with the Planning Commission and the Ministry of Finance at the RE Stage for plan allocation as per the basic needs of SSI sector.

Proposals/targets 10th Five Year Plan 9.196 The Committee was in agreement with the revision in the Tenth Five Year Plan target of annual growth rate of Twelve per cent and additional employment of 44 lakh for the SSI Sector. The Committee was however constrained to note that the revised growth was yet to be achieved. The Committee therefore desired that resilient monitory mechanism must be set up for timely and effective implementation of schemes/programmes/Action Plan on whose assumption the revised target has been set up. Since SSI Sector was emerging as one of the largest employment provider after agriculture, therefore, all Governmental impetus must be given on the promotion of SSI sector, recognizing and treating SSI as a "real Engine of national growth and development". The Committee understood that the SSI had to grow and thrive in the global competitive environment unleashed by the globalization and liberalization process, therefore, concerted efforts should have made for holistic and integrated course of action for consolidation and promotion of SSI sector by focusing on searching avenues for employment generation on the one hand and providing

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technology up-gradation, marketing and infrastructures support and adequate and timely credit support to the SSI sector on the other hand.

Appropriation of fund under Revenue Section for the year 2005-06 9.197 The Committee took note of the appropriation of fund under Revenue Section for the year 2005-06 which has been earmarked to the tune of Rs.390.71 crore(exclusive of Rs.3.75 crore of works outlay provided in the Demands of Ministry of Urban Development) as compared to Revenue Plan outlay of Rs.347.25 crore in 2004-05. The Committee was in agreement with the Planning Commission and the Ministry of Finance for enhancing allocation to implement the schemes of SIDO like Tool Rooms (by Rs.1.80 crore); Integrated Infrastructure Development Scheme (by Rs.13.94 crore) Micro Finance Programme (by Rs.2.70 crore); Credit linked capital subsidy for Technology up-gradation (by Rs.12.51 crore); Technology Up-gradation (by Rs.4.05 crore).The Committee desired that the Schemes/programmes so undertaken during the financial year 2005-06 could be implemented without cost and time over-runs and with the determined goal to consolidate and proliferate the SSI Sector for enabling this Sector to catch up the global trend.

Non-plan Revenue Outlay 9.198 The Committee was in agreement with non-plan Revenue Outlay projected to the tune of Rs.51.39 crore during 2005-06 as compared to non-plan revenue outlay of Rs.52.15 crore during the year 2004-05. However, the Committee liked to know that all efforts should have been be made for rationalization of non-plan revenue expenditure as per the guidance of the Ministry of Finance. The Committee was of the strong view that capital plan outlay to the tune of Rs.15.00 crore ( to be rectified at stage, enormously shown presently at Rs.18.20 crore) could inject in NSIC the borrowing capacity to rawase funds from financial institutions. The Committee liked to know the progress / status report in regard to the release of Equity Support to NSIC which had been approved by EFC on 15th March, 2004. The Committee understood that the enhanced borrowing capacity of NSIC, together with equity participation / contribution could enable NSIC to focus on technology up-gradation and thus contribution to the promotion of SSI.

Re-christening of the Ministry of SSI Ministry of Small and Medium Establishments 9.199 The Committee was of the view that the Government should have been re-christen the name of Ministry of SSI into the Ministry of Small and Medium Enterprisess (SME) in order to implement the objectives, achievement and targets of Indian SMEs as set by Finance Minister in General Budget 2005-06. The Finance Minister in his Budget Speech 2005-06 also had stated that “In recent years, our approach to small scale industry has evolved, and now we were inclined to treat the sector as the small and medium enterprisess sector”. the Committee was of the view that creation of two separate Departments, e.g., Department of Small Scale Industries and the Department of Medium Enterprisess under the re-christened name of the Ministry of Small and Medium Enterprisess and same could be effectively monitored by the present Ministry directly. The Finance Minister in his Budget Speech 2004-05 had also stated that “Small scale industry was, and must be regarded as, an engine of growth. At the same time SSI units must also be given the space to grow into medium enterprisess. World over, policies were devised to meet the requirements of small and medium enterprisess (SME)”. The Committee also endorsed the view of the Finance Minister and the scope of Ministry of SSI should be enlarged to cover the service sector in addition to the manufacturing sector to define and include medium establishment.

Development Commissioner for Small Scale Industries (including library) 9.200 The Committee took note of the enhancement of plan outlay under Major Head 2851 from Rs. 6.69 crore in BE 2004-05 to Rs. 5.74 crore at RE stage during the same year and further to Rs. 6.41 crore in BE 2005-06 to meeting the rising expenditure on the publications and advertisement and SENET project. The Committee was in agreement with the projected plan expenditure and hopes that the earmarked plan outlay could be judiciously utilized for dissemination of information and successful implementation of SENET projects in economically backward states like Bihar, Orissa, Jharkhand and West Bengal. Non-plan outlay under Major 2851 for DC (SSI) 9.201 The Committee was in agreement with the enhancement of non-plan outlay under Major Head 2851 from Rs. 8.50 crore in BE 2004-05 to Rs. 8.59 crore at RE stage during 2004-05 and further to Rs. 8.77 crore in BE 2005-06 due to normal increase under salaries after the merger of 50% D.A. with the basic pay and

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revision of pay scale of Small Industries Promotion Officers (SIPO), annual increments etc. It was hoped that efforts to rationalize the non-plan expenditure could continue during the year 2005-06.

Establishment bill of Library and its utility in proliferation of Small Scale Industries 9.202 The Committee was of the view that measure should be undertaken for dissemination of information and knowledge nation wide in regard to SSI and setting up of the SSI units through this library.

Role and relevance of the office of DC (SSI) 9.203 The Office of DC (SSI) maintained liaison with the Central Ministries, planning Commission, state Governments and Financial institution. DC (SSI) was on the Board of Directors of the SIDBI. Each Director, SWASI in the State was a member of the State Level Inter-Institutional Committee, which deals with the revival of sick SSI units. Steps could have been undertaken to strengthen and streamline the liaison mechanism of office of SSI for the furtherance of Small Scale Industries.

9.204 Monitoring mechanism was steered by office of DC (SSI) as an apex body for formulating, co-ordinating and monitoring policies and programmes for promotion and development of Small Scale Industries in the country. While the basic structure and process of the monitoring mechanism were adequate, the same could have been further strengthened and streamlined by taking into account the experience of implementation of the proposed legislation, viz, the Small and Medium Enterprisess Development Bill.

National Small Scale Industries Board 9.205 The Committee acknowledged the functioning of National Small Scale Industries Board in facilitating co-ordination and inter-institutional linkages, however, its role might have been made more effective and instrumental in organizing the Small Scale Sector. It could have been helpful in enlightening the understanding the small-scale industries, if the major decision of the National Small Scale Industries Board was made known to this Committee.

Status of Policy Package announced by Prime Minister on 30th August, 2000 9.206 The Committee was pleased to know that out of the 29 action points, which emerged out of the Policy Package announced by the Prime Minister on 30th August 2000, action had been completed on 27 points. However, action on issues like enactment of Limited Liability Partnership Act and Act on Factoring Services was pending with Ministry of Company Affairs and Ministry of Finance, which could have been expedited with active persuasion of the Ministry of SSI. Opportunities ahead awaiting were the sunrise industries like IT and service sector, which must be adequately, harnessed. The Committee desired that the Comprehensive Policy Package which was under active consideration of the Government must address the issues viz. non-availability of sufficient and timely credit, sufficient policy back up to meet the tighter IPR regime requirements and WTO implications, meant to ensure technology up-gradation and labour related regulatory requirements and inspector raj in the right prospective.

Third Census of SSIs (2001-02) and need for National Policy for Small Industries 9.207 The Committee was of the view that the national policy and programmes/ schemes should have suitable, and effective for supporting the promotion and development of small scale industries. The main emphasized should have been on easy credit availability, technological upgradation and modernization, infrastructural development, marketing support, etc. Moreover, for uniform and sustainable growth of small scale industries with an objective for greater employment creation and equitable distribution of wealth all over the country, there was a need for a national policy for small industries. To address the needs in the changed economic scenario, the Government could have come out with a promotional policy package at the earliest. The findings of the Third Census could have been used for policy formulation as follows:-

(i) Liberalise credit policy to make institutional credit more accessible to SSI units, including the unregistered units.

(ii) Identify industries requiring technological upgradation which could be assisted either under the on-going programmes/schemes or new appropriate schemes for the same.

(iii) Target sub-sectors which have high employment potential, for assistance under different schemes.

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(iv) Assistance for improving quality and productivity, especially of registered units which account for bulk of the output.

(v) Identify high-tech industries which could be promoted in the SSI sector. (vi) Formulate schemes of assistance for the growing service sector (SSSBEs). (vii) Evolve a system for regular collection of data through sample surveys at shorter intervals. (viii) Evolve a mechanism for reaching the benefits of Government assistance to unregistered

units.

Participation of voluntary organization in the development of Small Scale Industries. 9.208 The Committee noted that the DC (SSI)’s Office has also been organizing various programmes Entrepreneurship Development Programmes ( EDPs), Management Development Programmes (MDPs), Vendor Development Programmes (VDPs), Entrepreneurship Motivational Programmes with intensive participation of voluntary organisations. The committee hopes that the assistance provided to the voluntary organisations through the Integrated Infrastructure Development (IID Scheme), Testing Centres , SSI MDA, Sub-Contracting Exchanges , Scheme on Trade Related Entrepreneurship Assistance and Development (TREAD) for Women by the Office of DC (SSI) could yield tangible result and involve the Voluntary Organisations more in number to conduct EDPs, MDPs, etc., in the interior areas after providing them necessary training.

Efforts of DC (SSI) on Development of Accredited clusters

9.209 The Committee welcomed the proposal for selection for 60 cluster by DC (SSI) and which has been forwarded to RBI for clearance and instructing Public Sector banks for providing adequate credit flow. It was hoped that RBI could expedite the process at the earliest. The Committee was of the strong view that the cluster development initiatives could lead to technology up-gradation design development, up-gradation of skills, increased production and export and enhancement of competitiveness of the clusters. A resilient monitoring mechanism was required to achieve the desired success on cluster approach.

Grants to National Small Industries Corporation for development of Small Scale Industries

9.210 The Committee was in agreement with the proposal to grant made to the tune of Rs. 22.50 crore in BE 2004-05 and to Rs. 23.80 crore in BE 2005-06 to NSIC intended to provide promotional and commercial services to SSI in the area of marketing, credit, technology and information. The provision included the allocation made to the tune of Rs. 3.25 crore in 2004-05 and Rs. 6 crore for 2005-06 for a new scheme for SSI which was justifiable keeping in view the need for enhancing credit to SSI sector.

Credit rating system for SSI

9.211 The Committee was very positive in its expectation for the success of credit rating system for SI sector and in this regard the role of credit rating agencies CWERE, CRWASIL , D&B, FITCH, ICRA and ONICRA could have been crucial. The Committee recommended that NSIC should have played proactive role in co-ordinating the scheme and monitoring the successful implementation of the scheme.

Appropriation of non-plan expenditure for NSIC in the year 2004-05

9.212 The Committee was of the considered view that the financial requirement of NSIC for implementing the Voluntary Retirement Scheme to rationalise the man power could have been assessed and accordingly sufficient budgetary support may be earmarked for the purpose.

Promotion of SSI products in domestic and international market 9.213 The Committee was of the view that following steps may be undertaken for promoting SSI products in domestic and international market:-

(i) Increased participation of small industries in domestic and international trade fairs. Support in the area of product design and packaging. These were extremely important from the point of view of exports and tapping of the middle and higher income domestic consumers.

(ii) Technology audits and bench marking with competitors to identify gaps.

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(iii) Establishing world-class product display centres for Small Scale Industries in important cities.

(iv) Third party accreditation services. Accreditation was a necessary for buyer comfort. Accreditation indicates manufacturers ability to supply reliably and effectively. Co-branded accreditation services could have been rendered through established accreditation agencies to enhance acceptance of products made in small industries.

(v) Providing reliable market intelligence and trade led in different industrial sectors. It could have also assisted SSIs in the marketing efforts. NSIC Infomediary Services were aimed in this direction.

(vi) Brand building and consortia operations were extremely important marketing tools and these call for good degree of mutual trust among small scale units to maintain uniform quality.

Market share of SSI products

9.214 The Committee was of the view that for enhancing the market share of SSI products in domestic and international market, the following areas need to be focused:-

(i) Providing full credit, technology up-gradation, modernization and marketing support to the SSI sector;

(ii) Infrastructure up-gradation in general, particularly in the major SSI industrial clusters; (iii) Freedom from the plethora of rules and regulations existing in the SSI sector, which was

known as Inspector Raj; (iv) Full support to the service industry to fulfill its true growth and employment generation

potential; and (v) Training of existing and potential entrepreneurs and workers on a massive scale for

technological upgradation. SWOT analysis on the Working of NSIC. 9.215 The Committee acknowledged of the role of NSIC. However, following measures may help NSIC in fulfilling its role more effectively:-

(i) Greater flexibility to the NSIC Board to induct professionals in order to build the internal competency levels.

(ii) NSIC should have been declared a nodal agency for purchases by Government Departments/Agencies. This will enable NSIC to play an effective role in marketing the products of the SSI sector.

(iii) NSIC should be treated at par with SSIDCs in matters relating to allocation of Steel and other raw materials. At present, allocation of steel was made to NSIC only in those states where SSIDCs do not exist.

(iv) The Components of NSIC programmes should have incorporate identification of new

markets, Consortia and Brand building, Quality assurance and rating Cluster specific catalogues

(v) Business development services must have extended in the areas of Marketing, Credit Technology, Infomediary services , International partnerships.

Promotion of Small Scale Industries Schemes

9.216 The Committee hoped that the plan allocation earmarked to the tune of Rs. 131.01 crore BE 2005-06 under the Major Head 2851 could go a long way in the successful implementation of IID scheme, Tool Room, Technology up-gradation and the credit linked capital subsidy scheme. The Committee desired that the Ministry of SSI, in its Action Taken Note of the present Report could have been a detailed note on the tangible achievement of these programmes in creating / improving infrastructure for new units and old industrial states and up-gradation of technology and cluster development. In it was regard, the Committee recommended that specific Action Plan may be chalked for implementation of SSI promotional schemes in economic backward regions like Orissa, Bihar, Jharkhand, Chhattisgarh, Uttranchal and M.P. so that employment generation may be implemented in these states.

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Non -plan allocation under Major Head 2851

9.217 While agreeing with the allocation of projected non-plan expenditure to the tune of Rs. 38.01 crore in BE 2005-06 as compared to Rs. 37.70 crore in RE 2004-05 under Major Head 2851, the Committee recommended that effort should have been made to undertake austerity measures so that supplementary demands may be asked only in exceptional circumstances.

Appropriation of Plan Outlay to the tune of Rs. 3.45 crore in BE 2004-05 under Major Head 3601 9.218 The Committee was in agreement in principle with the Planning Commission and the Ministry of Finance for earmarking fund under Major Head 3601 and 3602 as the provision under these Heads were meant for grants-in-aid to the states Government (Major Head 3601) and U.T.s (Major Head 3602) to collect, maintain and update information on economic characteristic of Small Scale sector such as employment, investment, production, inputs and wages, requirement of raw material, working capital, value at the various industrial groups. However, the Committee recommended that following strategy / methodology should have been adopted for utilization of collection of data and information pertaining to SSI sector :-

(i) While allocating fund under Major Head 3601 and 3602 the requirement of SSI sector and its development stage in each state should have been taken into account and appropriation of fund should be made as per the requirement for ameliorating the SSI sector in each state;

(ii) Purposive interpretation of data so as to allocate funds to boost the SSI sector in each state keeping in view the strategic course of action i.e. consolidation of SSI units in Gujrat, Maharashtra, Karnataka and A.P. where the SSI sector was doing well while higher impetus may be given for promoting / encouraging first generation entrepreneur in the states like Bihar, Jharkhand and Orwassa where the SSI sector was still to come up.

(iii) Collection of data as per component specific of SSI units and their interpretation in the manner as to make research work for sector specific policy measures.

Rural Infrastructure Development Fund

9.219 The Committee understood that the corpus of Rs. 8000 crore for Rural Infrastructure Development Fund has been placed with the Ministry of Rural Development, however, it was because that the basic infrastructural development in the rural areas could also going to benefit the Small Scale units in the rural whereas, the Committee desired that the Ministry of SSI should co-ordinate by mulling out the "areas of Mutual Co-operation" with the National Bank for Agriculture and Rural Development (NABARD) and Ministry of Rural Development. Supply of electricity and construction of roads particularly in the backward states like Bihar, Orissa and Jharkhand under RIDF could also promote SSI sector, as these states suffer from basic infrastructure like road and supply of regular power despite the working of the IID Scheme implemented by the DC (SSI) which was well within the organizational set up of the Ministry of Small Scale Industries.

Monitoring Mechanism under Capital Subsidy Scheme

9.220 The Committee was constrained express its anguish on the delay in implementation of its decision regarding raising the ceiling for loans under the Capital Subsidy Scheme from Rs. 40.00 lakh to Rs. 1.00 crore (as announced by the Finance Ministry in the General Budget for the year 2004-05) on promotion of Small Scale Industries. A considerable period of time has elapsed but the decision, which has already been taken, was still waiting for implementation on the pretext that that it could be included in promotional package for the Small Scale Industries(SSI). The committee was of the view that the Government should have not withheld the implementation of raising the ceiling for loans under the Capital Subsidy Scheme from Rs. 40.00 lakh to Rs. 1.00 crore . The promotional package for the Small Scale Industries(SSI) could have at a later stage.

Problems being faced by SIDO in the implementation of credit linked capital subsidy

9.221 The Committee was of the view that the following course of action may be adopted for facilitating SIDO in implementation of Credit Linked Capital Subsidy Scheme (CLCSS) successfully:-

(i) Organising awareness programmes at various location all over the country to increase the awareness level of industry association, banks, SIDBI and Industry Departments of respective States

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(ii) Review of progress of the scheme in meetings State Level Bankers Committees (SLBCs), (iii) Incorporating inputs on the scheme into in service training courses of Bank Managers (iv) Other publicity measures to increase general awareness about the scheme

9.222 The Committee understood that most of the schemes/programmes as implemented by SIDO aims at augmenting the credit flow to the SSI sector and were linked with the banks/financial institutions. To enhance the credit flow to the SSI sector and at the same time improve the comfort level of the banks to extend more credit to the SSI units/ entrepreneurs, there was a need to encourage SSI units for obtaining credit rating and setting up of exclusive credit rating agencies for the SSI sector. There was also a need for wider and effective dissemination of information on the schemes/ facilities being provided by the banks to the SSI sector at the branch level and among the entrepreneurs.

9.223 The Committee was of the considered view that State Governments need to provide an enabling environment for development and promotion of the SSI sector through provision of fiscal concessions/incentives to the sector, better infrastructure facilities etc. for facilitating smooth implementation of the schemes of SIDO. The Ministry of SSI might have taken up these issues with the State Governments regularly and effectively. Other Schemes 9.224 The Committee in agreement with reduction of plan allocation under Major Head 2851 earmarked for "Other Schemes" from Rs. 9.25 crore in BE 2004-05 to Rs. 7.35 crore at RE stage during the same year and further to the tune of Rs. 5.20 crore in BE 2005-06. In so the reduction was the resultant of lesser requirement of grants-in-aid for the Training Institutes like NWASIET, NIESBUD & EDWAS, as their reckoning to self-sufficiency was a matter of pleasure.

9.225 However, the Committee desired that adequate survey, study and policy research must be conducted for generation of large scale employment opportunities on a sustainable basis in rural were Bihar, Orissa, Rajasthan, Jharkhand, M.P. U.P., Uttranchal and Chhatisgarh. The Committee was of the strong view that there was immediate need for enhancing the competitiveness of SSI sector in these states (as observed by the Committee during its study visit to Patna, Bhubaneshwar, Ranchi, Ahmedabad and Lucknow) by setting up of institutional framework in were as such as credit, raw-material, infrastructure, technology up-gradation, marketing and formulation of suitable arrangement for skill development.

9.226 The Committee recommended that an all out efforts should have been made by the National Entrepreneurship Development Board for encouraging First generation entrepreneurs in economically backward regions so that substantial investment may be made in these region for improving standard of living of common man wages. The selection of key areas for massive action to promote and proliferate SSI units in these areas could go a long way in employment generation and poverty alleviation. The Ministry of SSI and its attached office should have been taken initiatives in this regard and accordingly requirement of budgetary support be projected.

Credit Guarantee Scheme

9.227 The Committee understood that one of the main objectives of the scheme was to generate more employment opportunities by facilitating collateral free loans to small enterprisess. However, despite the provision of the loans up to 25.00 lakh without collateral/third party guarantee and the guidelines of the Reserve Bank of India thereto, Banks were reported to insist on the collateral security and the third party guarantee. The committee has repeatedly recommended for a change of the mind set of the Branch Manager, nothing fruitful has come out so far. The Committee directs all the Banks who were Members of this scheme to implement the scheme so as to make it success.

9.228 The Committee takes note that under Major Head 2851 Credit Guarantee Scheme the Plan Outlay has been increased to the tune of Rs. 180.00 crore in BE 2005-06 in comparison to Rs. 176.29 crore in RE 2004-05. The provision made under the scheme was for contribution to the Corpus Fund. The envisaged level of corpus at the end of Tenth Five Year Plan was of Rs.2500 crore. But with a Plan outlay of Rs.900 crore in the Tenth Plan and Rs.200 crore released during the Ninth Plan, the envisaged level of Rs.2500 crore couldn’t be achieved. The Committee was anguished to observe that plan allocation was not made as originally conceived

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under the scheme. Therefore, in order to enhance the comfort level of ML was participating in the scheme, it was desirable that the corpus was enhanced to the envisaged level. With the building of adequate corpus fund, the fears of ML could be allayed as still some of the banks have reservations about the scheme because of their bad experience in the past with a similar scheme operated by the RBI.

9.229 The Committee recommended that monitoring mechanism comprising all the Money Lending Institutes (MLIs) at the regional level and the Directorate of Industries of the respective States, to review the progress made under the Credit Guarantee Scheme, periodically should be put into place for improving the monitoring mechanism for successful implementation of the projects undertaken with the aid of credit Guarantee Scheme.

9.230 The Committee hoped that modification introduced in Credit Guarantee Scheme and implemented with effect from 1st February, 2005 could proved instrumental in making the scheme. National Commission on Enterprisess in the Unorganized/Informal Sector

9.231 The Committee was in agreement with the provision made under Major Head 2851 for footing the expenditure for National Commission on Enterprises in the Unorganized/Informal Sector. As the Commission was constituted in September, 2004 it was too short period to comment upon its performance. The Committee hopes that the findings of the Commission will be helpful in regulating the SMEs in informal/un-organized sector.

Lump sum provision for projects/schemes for the benefit of the North Eastern areas and Sikkim 9.232 The Committee desired that the Ministry of SSI must ensure that its attached office must act pro-actively in implementation of originally conceived schemes / programmes in NE Region which needs immediate attention of Government so far the was balanced regional development was concerned. The Committee was constrained to observe that out of the total of Rs. 35.62 crore plan allocation under Major Head 2552 meant for Credit Guarantee Scheme. IID scheme R&IC, SISIs and IIE only a sum of Rs. 29.51 crore could be expensed during the year 2004. The Committee desired that Rs. 37.09 crore earmarked for the purpose during year 2005-06 could have been properly utilized.

Action Plan for promoting SSEs in NE and Sikkim

9.233 The Committee understood that the major areas of concern in the North Eastern Region and Sikkim were lack of infrastructure like road and rail communication, shortage of power for industrial use, availability of skilled manpower, low entrepreneurial skills, access to finance, technological obsolescence and lack of large scale manufacturing units which provides ancillary opportunity to SSI community, therefore, the committee desired that the Ministry of SSI should have been taken initiatives in this regard by taking the matter with State Governments and DONER. The Committee was of the view that North Eastern Region and Sikkim should have been been facilitated with focused entrepreneurship development programmes, technical training & skill up-gradation, awareness of industrial opportunities for manufacturing in NER & Sikkim and supplying to the rest of the country, relatively softer credit and marketing assistance programmes.

Institutional arrangement made in North Eastern areas for promotion of SSI in the region

9.234 The Committee was of the view that in order to increase its reach in the region, NSIC should have been opened more offices in North Eastern Region. NSIC and take up programmes jointly with Indian Institute of Entrepreneurship, Guwahati and with other organizations like NEDFI and NEC.

9.235 The Committee was constrained to note that the plan outlay of Rs. 1.50 crore as reflected in the year 2004-05 Under Major Head 4552 was by way of equity participation by the Government was yet to be released by the Government. The Committee could have liked to know the reasons for non- release of earmarked fund. The Committee recommended that the business restructuring programme of NSIC should have been completed with the stipulated timeframe and fund earmarked for the purpose be released as per originally conceived schedule. The Committee feels that the Ministry has to play proactive role in pursuing and motivating the NE states to send proposals so that funds were utilized in time. The Committee was accordingly, of the view that the Ministry of SSI should have been have resilient monitoring mechanism for implementation of schemes / programmes in NE region as the region counts for strategic economic and diplomatic reasons.

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Investments in Public Enterprises

9.236 The Committee hoped that the budgetary support to the tune of Rs. 13.50 crore in 2004-05 and to the tune of Rs. 14.00 crore in 2005-06 by way of equity infusion by the Government and raissing fund through IEBR to the tune of Rs. 62.00 crore in 2004-05 and 2005-06 as well could go a long way in making NSIC self-sufficient through implementing business restructuring programme and NSIC could been in a position to serve large number of SSI units and guarantying consumer's satisfaction.

Tiny and Micro Enterprises

9.237 The Committee reiterated its recommendation made in its report on Demands for Grants (2004-05) pertaining to Ministry of SSI that effective efforts should have been made for (i) better importing of entrepreneurs skills and training, (ii) acquiring marketing techniques (iii) Access to appropriate technology (iv) strengthening capital base and institutional credit and (v) providing Infrastructural facilities and the tangible progress made in this regard may be communicated to the Committee in the Action Taken Note of the present report.

Technology upgradation of SSI units

9.238 The Committee recommended that activities like buyer-seller meets and vendor development programmes must regularly be organized all over India, including the economically backward region to establish linkages between large and small enterprises to accelerate and strengthen the partnership approach to develop linkages between large and small enterprises. Apart from Government Departments like Defence, Railways, coal, steel, Petro-chemical, food and food- processing etc., Public Undertakings and Private Sector Industries should have been also invited to participate in these events. Moreover, following course of action must be taken for:

(a) revitalization and regeneration of existing organization and revamping of existing organization and revamping of the mechanism for technological up-gradation;

(b) R&D in technology up-gradation further steps required for designing; (c) measures towards cost-reduction; and

(d)Steps towards avoidance of waste and non-value adding activities.

Promotion of Technology Banks and encouragement to Technology Parks. 9.239 The Committee hoped that the de-reservation of 108 items, as announced in the Budget (2005-06) could have helped the small scale sector to meet the demand for technological upgradation, encourage research and development and make the sector competitive to face the domestic and global competition. A status report on the practical implication in this regards may be furnished to the Committee in its Action Taken Notes of the present Report.

Fair Practices code for Lenders

9.240 The Committee understood that the adoption of "Best Practices Code" for large corporate dealing with the SME Sector on the line of the code for payments for large industries /corporate" could have greatly helped the sector regarding timely payment to SMEs. Despite RBI's Guidelines on Fair Practices code for Lenders", nothing has practically been achieved. No initiative has been taken to address the issue of delay payment in the General Budget 2005-06. Under the circumstance, the Committee feels that Government should have been come out with alternative arrangement i.e. scruitinisation law to provide relief to the SSI sector from the delayed payments.

Enactment of Limited Partnership Act

9.241 The Committee was in agreement with the opinion of the Ministry of SSI that the Limited Liability Partnership will provide higher flow of capital in to the Sector, especially to the upcoming sections like IT, Bio-technology, Pharma, etc and could also encourage venture capital. The committee, therefore,

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recommended that the Ministry of SSI should have been taken up the matter of Enactment of Limited Partnership Act with the Ministry of Company Affairs.

Specific Export Thrust/Policy measures

9.242 The Committee feels that there was a need for the formulation of sector specific export thrust/policy measures and establishment of more Export promotion zones to promote international trade of select SSI items especially ready made garments, Leather products, basic chemicals, Marine and processed foods and engineering goods which account for 3/4th of the total export from SSI sector. This was required to promote international trade.

Abid Hussain Committee Report

9.243 The Committee was given an understand that recommendations of Abid Hussain Committee Report were still relevant for the promotion of small and medium enterprises, as it has provided a road map for making the small enterprise able to grow on its own and graduate in to medium enterprise. It recommended for single law of small enterprise, limited partnership act and removal of regulatory barriers to the technological progress of the Sector were quite relevant. The Committee therefore, strongly recommended that the Government in its proposed Small and Medium Enterprises Bill, 2005, should have been incorporated the provisions pertaining to recommendations Abid Hussain Committee.

Concept of factoring services for SSI Sector

9.244 The Committee endorsed the viewpoint of the Ministry of SSI that factoring services could provide instant liquidity to industries, particularly to small scale and tiny sectors, prior to the maturity period of various instruments drawn for supply or purchase of goods or services by assignment of debts or receivables to a factor. Since the Factoring services had played an effective role as an alternate mode of working capital finance for the past three decades in some of the countries. The Committee felt that the Factoring Services Legislation could also help to mitigate the problem of delayed payments to SSI units and augment the flow of funds to the SSI Sector. The Committee, therefore, recommended that the Ministry of SSI should have been also pursue the proposed Act on “The Factoring of Debts due to Industrial and Commercial Undertakings” with Ministry of Finance (Banking Division) .

Trends of sickness in SSI sector

9.245 The Committee desired that RBI'S guidelines in regard to credit flow to SSI sector must be observed by pubic sector Banks to facilitate additional capacity generation, expansion of existing units and improving capacity utilization diversification and to enhance competitiveness of SSI sectors.

Venture capital funding to SSI units

9.246 The Committee desired that suitable and adequate steps must be undertaken for popularization of venture capital funding to SSI units. Banks should have been felt encouraged in this regards as RBI has already announced that investment in venture capital could be eligible for inclusion in priority sector lending. Strengthening of Small Industries Development Bank of India (SIDBI) for extending financial and support services to SSIs. 9.247 The Committee appreciated the role of SIDBI in taking various strategic initiatives to improve the flow of credit to the SSI sector by broad basing certain schemes in tune with changing requirements of the sector, however, SSI sector remains for want of adequate credit flow. Therefore, in order to extend financial and support services to SSIs, SIDBI should have been also get into direct lending in a big way apart from refinance. For this, it was necessary that SIDBI was permitted to offer a total package of services including opening up of accounts, cheque book facilities and other fund based and non-fund based services to the SSI units like other banks rather than giving only term loans.

FDI for better technology transfer in SMEs sector 9.248 The Committee recommended that the Government give the green signal to the proposal of the Ministry of SSI in regard to the enhancement of equity participation / FDI limit from 24% to 49% in the case of SSI items where investment limit has been enhanced to Rs.5 crore as the could be encouraging FDI for better

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technology transfer in SME sector. Specific steps were taken during the financial year 2004-05 for enhancing the contribution of SSI in the National economy 9.249 The Committee recommended that for streamlining and strengthening the contribution of small enterprises sector in the national economy, the Government should have been focus the following strategy:

(i) Providing full credit, technology upgradation, modernization and marketing support to the SSI

sector. (ii) Infrastructure upgradation in general and particularly in the major small enterprise clusters; these

could include road connectivity, regular supply of power, common effluent treatment facility and water supply, etc.

(iii) Reducing the rigours of complying with the plethora of rules and regulations applicable in the small enterprises sector, which was known as Inspector Raj.

(iv) Full support to the service industry to fulfill its true growth and employment generation potential.

(v) Training of existing and potential entrepreneurs and workers on a large scale in modern management practices and skill upgradation through advanced training facilities for capacity building in the small enterprisess sector.

Action Plan for the year 2005-06

9.250 The Committee desired that as a precautionary measure to achieve the Action Plan for the year 2005-06, the Ministry of SSI should have been reviewed and monitor the progress of the work closely. The functioning of organisations under the Ministry, implementation of Plan schemes and various developmental activities should have been reviewed at various levels regularly. The Monitoring mechanism to oversee the functioning of various organizations under the Ministry of Small Scale Industries should be made more effective. Action Plan for the year 2005-06

9.251 The Committee desired that as a precautionary measure to achieve the Action Plan for the year 2005-06, the Ministry of SSI should have been reviewed and monitor the progress of the work closely. The functioning of organisations under the Ministry, implementation of Plan schemes and various developmental activities should have been reviewed at various levels regularly. The Monitoring mechanism to oversee the functioning of various organizations under the Ministry of Small Scale Industries should have beenbe made more effective. (m) 172nd report 9.252 The Committee appreciated the role of Coir Board in the overall development of coir industry in India characterized by increased production, increased consumption, export and employment in rural sector. Development of Coir Industries in India has led to Women empowerment and welfare of workers. The role of the Coir Board in the field of R&D in coir sector has strengthened, new products like coir ply, packaging material and geo-textiles. Coir Board as a national organization has been committed to the sustainable development. The Committee hoped that the Coir Board could continue to make its lasting contribution in the promotion and proliferation of Coir Industries not only in the Coir producing states but the non-traditional zones also.

SWOT –analysis of Coir Industries

9.253 The Committee recommended that the Coir Board could be made a serious assessment of SWOT analysis of Coir Industries. Strength of the Coir industries must be capitalized and the opportunities ahead must be availed of. Similarly, strategy should have been chalked out to combat the threats and overcome the weaknesses of the Coir Industries. The Committee has commended contribution of the coir board in its 141st Report to chalk out action plan for promotion and proliferation of coir industries in West Bengal and Andman and Nicobar Islands. Similar action plan may be chalked out for other states on the local logistics.

Cost reduction of coir products

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9.254 The Committee took note of the basic characteristics and problems of coir industries and the action taken or be envisaged to be taken by the Coir Board and the Ministry of ARI. The Committee was of the view that with massive efforts and implementation of financial assistance scheme to encourage setting up of new units could result into higher utilisation of husk from the present level of thirty seven per cent. The Committee recommended that the Ministry of ARI and the Coir Board to undertake cost management programme in the coir manufacturing units with the assistance of Research Institute like Entrepreneurship Development Institute of India, Ahmedabad and the others. Due impetus may also be given to cluster development activities and consortium approach to reduce the cost of production. 9.255 The Committee understands the Coir Industries was labour intensive industry and major components of the labour force were the women. Therefore, promotion and furtherance of coir Industries could lead to empowerment of women besides enhancing the economic prosperity of the States. Action plan may be chalked out for enhancing the economy of scale so that cost of production may come down and avenues of employment generation may further be explored.

Coir industry as export oriented industry

9.256 The Committee understood that the coir exporters face competition in markets abroad from other natural products like Chinese Grass Mats, Rubber, Sisal and coir products being exported by Srilanka, Taiwan, Philippines etc. Synthetic products manufactured using improved technology and supported by publicity also pose great threat to the coir exports. The Coir Geo-textiles were facing competition from Srilanka and synthetic geo-textile materials, which dominate the market. Therefore, the Committee felt that the Government should have been provided assistance by reimbursing a portion of the expenditure incurred on brand based publicity abroad projecting the eco-friendly nature of the coir geo-textiles to meet this competition.

Marketing Strategy 9.257 The Committee was of the view that steps being contemplated by the Coir Board to promote the marketing and sales of coir products in the domestic market which interalia include intensification of promotional measures like publicity through print and electronic media; increased participation in trade fairs and exhibitions; organisation of Buyer –Seller Meets in potential regions; organisation of special sales campaign and festival discount offer to promote sales; organising collective participation of manufacturers in selected trade fairs and exhibitions; popularisation of new products like coir geo-textiles, garden articles, coir pith based products through awareness creation programmes etc. could go a long way in the promotion and furtherance of the Coir Industries in India and could inject competitive resilience to face the global competition wherein China was becoming a great threat to the India's monopoly in the Coir Industries 9.258 The Committee was of the opinion that in the liberalized and globalized market structure since the consumer was the king, all marketing and sales strategy should have been based on the plank of the actual need and taste of the consumer therefore, the marketing research should have been conducted accordingly and efforts should be made for introducing modification in products. This could lead to widening of product range and suitably meeting the demand of the consumer as per specification. Popularization of value products through buyer-seller meet and seminar could definitely lead to product promotion, cooperative Coir marketing strategy, and public private partnership could lead to encouragement to coir industries.

Restructuring of the Coir Industry 9.259 The Committee understood that the Low productivity of traditional technology, age old looms and equipments, slow phase of modernisation, absence of a systematic collection of raw material, lack of adequate credit availability, low level of capacity building, inadequate infrastructural facilities, limited marketing skills, lack of working capital were the bane of this industry. The Committee, therefore, feels that it was necessary to put in place an integrated and complimentary set of measures to encourage and support coir industry so that they become more productive and competitive and development and expenditure takes place in a sustainable and sustainable manner.

Creation of Utility Demand 9.260 There was lack of initiative in the part of exporters for undertaking promotional efforts such as direct publicity, brand promotion, efforts to enter new markets etc. This was due to the poor nature of the industry.

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The Committee feels that the Coir Board should have been undertaken promotional campaigns in markets abroad projecting the eco-friendly nature of coir products for which advance proposals will be given by the Coir Board and necessary approval should have been accorded by the Government even at the beginning of the financial year itself. 9.261 The Committee was of the strong opinion that a Modernisation Fund may be created for extending one time financial assistance to the exporters for modernisation of production, importing necessary machinery and equipments including packaging and labeling machineries and also for setting up of R&D facilities. This could enhance production and quality and could act as a means to meet competition. Capturing new markets through delegation, Market missions, publicity etc. 9.262 The Committee was of the opinion that apart from participation in exhibitions, it was also necessary to undertake Delegations and Marketing Missions to USA and EU countries to give market education. Release of advertisements in leading magazines should have been also be resorted to regularly. Product diversification, quality improvement through technology development 9.263 The Committee was of the view that the Coir Board should have been come out with the course of action required to be undertaken for the product diversification through technology development and forward the same to the Ministry of ARI for executing the projects.

9.264 The Committee was also of the view that the technological upgradation/automation/quality control etc. have to be achieved to ensure high volume production of quality products to be competitive in the export field. It was therefore necessary to extend assistance to the trade for export production, quality, design development, product diversification etc.

9.265 The Committee feels that the Government may grant the Coir Board the status of an approved agency for quality inspection of export products which could enable the buyers to utilise the services of the Coir Board for quality certification.

Market Survey 9.266 The Committee was of the considered view that in a competitive market economy, market survey/study was indispensable for exploring new avenues/horizon of market, therefore, the Coir Board should have been undertaken measures for exploring new market in Africa, Latin America and Third world countries. Encouraging SSI Coir Exporters to obtain WASO certification 9.267 The Committee was of the opinion that the Ministry of ARI may examine the isssue of empowering the Coir Board to implement the programme of incentive for adoption of ISO standards by the SSI Coir Manufacturer exporters. Creation of a Guidance Cell 9.268 The Committee desired that there should be creation of a Guidance Cell responsible to collect, compile and disseminate information on quality standards for entering into external markets, technology available for import, close linkage between manufacturers, exporters and Consortiums, requirements of packaging and labeling, import duties, sanitary and phyto-sanitary requirements, testing facilities, trade enquiries etc. This cell might have also be responsible for guidance in the matters related to WTO.

9.269 The Committee felt that the Inter Governmental Group meeting of the FAO and the AGM of the International Erosion Control Association being held regularly Coir Board may be allowed to participate on a regular basis and get benefited out come of the conference.

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Participation in Exhibitions/ Fairs abroad

9.270 The Board might have concentrated on capturing new markets as well as expansion of existing markets. It was also necessary to ensure that the existing market were not lost to the competing products. Coir Board may participate in exhibitions depending upon the markets and targeting specified regions. Coir Board may also organise exhibitions like India International Coir Fair and Coir India.

Measures Required for Promotion and Proliferation of the Coir Industry 9.271 The Committee understands the need for enhancing the harnessing of coconut husk for coir production from existing level of thirty seven per cent. With a view to mobilize husk available in plenty in coconut producing States and to increase the percentage of utilization of coconut husk, the collection mechanism will have to be streamlined with the active participation of NGOs, Self Help Groups (SHGs) etc. through introduction of an appropriate scheme. It could have paved way for level of utilization reaching 50% thereby facilitating production unhindered and to increase output of coir fiber in the country.

9.272 The Committee was in agreement with the Coir Board in regard to Constitution of Raw Material Bank in the coir sector to assist the Small Scale manufacturers in the private as well as co-operative sector. That was essential because access to quality raw material at reasonable price assumes great significance in the development of enterprises in the unorganized/informal sector.

Technology Upgradation – R&D efforts

9.273 The Committee was of the opinion that the concerted efforts have to be made towards technology improvement in the coir sector through research and development. Improvement of the infrastructural facilities and strengthening manpower available in research institutes of the Coir Board was necessary to address the situation. Further, efforts towards areas specific collaborative research with due prioritization based on industry needs, their better participation and that of nationally reputed R&D Organisations was called for.

Development of Versatile Spinning Machine 9.274 The coir industry required a versatile spinning machine compatible for production of different varieties of coir yarn with higher productivity, less strain and capable of undertaking commercial production.

Popularisation of Eco-friendly dyeing and Effluent Treatment Plant 9.275 The Committee recommended that the Ministry of ARI should have been extended all possible help to the Coir Board in envisaging strategy for popularization of eco-friendly dyeing and Effluent Treatment Plan either through in-house experiment or transfer/acquisition of required technology.

Popularisation of Coirret and Pithplus

9.276 The Committee desired that the Coir Board should have been taken adequate research activities and field demonstration on the use of coirret for faster rating and thus improving the quality and strength of the coir fibre.

9.277 The Committee was in agreement with the Coir Board that the intervention of coir producing State Governments in popularizing pith based organic manure through their Agricultural Departments and horticultural societies could result in setting up new pith processing units and generating a ready domestic market for product. Conversion of coir pith into an organic manure could be made a gainful economic activity to generate additional rural employment, particularly, in coir producing regions. Therefore, the Committee desired that the Ministry of ARI should have been taken up the issue with the Coir producing state government. Popularisation of Coir Composites 9.278 The Committee was of the view that the Coir Board should have been encouraged and invited the private sector units in the production of coir composites to enhance the potential of production capacity from the present level of 15000 mm Sq.mtr. to 4.5 lakh mm Sq.mtr. per day. Setting up of such units will have to

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be encouraged through provision of capital investment subsidy, therefore, the Ministry of ARI should have been undertaken appropriate step in this regard.

Extension of Marketing Facilities in the country 9.279 The functioning of the Coir Board Showrooms and Sales Depots were to be strengthened through appointment of Dealers/Commission Agents, opening of mini sales depots etc. to make coir products accessible to the rural and urban consumer public throughout the country in a better way. Further, the marketing assistance be extended to the manufacturers of non-traditional products like pith based products, garden articles, coir polymer composites also by bringing those products too under the product range of the Coir Board Showrooms & Sales Depots. This was required as an effort complimentary to promote coir products in the domestic market.

9.280 The Committee was of the opinion that in order to counter the increasing threat due to unleashing liberalization and globalization process and thereby to sustain and enlarge the domestic market the promotional efforts have to be strengthened through intensification of the existing efforts and observation of special promotional/Sales campaigns.

9.281 The Committee was of the view that Requiring Government Departments and public sector undertakings of various Ministries to go in for eco-friendly coir products for their furnishing requirements will encourage consumption of coir products for which institutional segments. Therefore, the Ministry of ARI may assist the Coir Board in various department/Ministry by advocating the case of Coir Board through Governmental Inter-Departmental Cooperation

9.282 The Committee was of the view that Ministry of ARI should have been taken up the issue of Government of India share of the Market Development Assistance with the Ministry of Finance for allocation as per the requirement. The GOI share of the Market Development Assistance was now disbursed through appropriation of funds earmarked for Domestic Market Development under plan scheme of the Coir Board. Allocation of adequate funds specifically for disbursement of MDA in the Annual Plan Allocation to the Coir Board to meet the entire claim from State Governments could benefit units in the co-operative and public sector, who were committed to promotion of minimum wages and other obligatory benefits to the coir worker.

Promotion of Export 9.283 The Committee was of the considered view that the major emphasis was to be given to the promotional efforts by way of publicity and participation in trade fairs and exhibitions and adoption of innovative promotional programmes. The Small and new comers in the export front should have been encouraged to participate in the international trade fairs and exhibitions along with the Coir Board by providing Export Market Development Assistance and all professional support. Efforts should be made for building a brand image for Indian coir in the domestic and international market, participation in product specific international trade fairs and exhibitions and organising buyer seller meets in potential and new markets, promotion of non traditional products like coir pith, coir geo-textiles, garden articles, coir composites etc. in potential regions through various export promotion measures and building up of a market oriented data base and market intelligence to provide continuous feed back to the trade. 9.284 The Committee recommended that in order to promote export, exporters of various products of coir may be granted Export Market Assistance at product specific rates as in the case of jute industry.

Formation of Manufacturers Consortia and the setting up of Common Facility Centres (CFC) 9.285 The Committee felt that the Formation of Manufacturers Consortia and the setting up of Common Facility Centres (CFC) could proved instrumental in launching and promoting cooperative society in the Coir Industry. Development of Production Infrastructure

9.286 The Committee feels that the units in the coir sector were encouraged for the development of base level infrastructure for construction of loom shed, retrofitting of the existing traditional ratts by motor attachment, replacement of the defective parts of mat/matting loom etc.

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Development of Cluster

9.287 The Committee feels that upgradation in the coir industry at desired level could be achieved only if small scale manufacturers and tiny units come together and form clusters as already experimented and succeeded in the coir sector as well as other industrial sectors.

Industrial Infrastructure Upgradation Scheme (IIUS) 9.288 The Committee feels that the cluster based coir sector development programmes for self employment generation through village level tiny sector units have to be replicated in other coir producing States like Tamil Nadu, Karnataka, Andhra Pradesh, Orissa, Lakshadweep etc. with funding support under IIUS and SGSY. Therefore, the Ministry of ARI should take up the issue with the concerned State Governments which could identify specific cluster locations.

Assistance under Credit Linked Capital Subsidy scheme

9.289 The Committee was pleased to note that the guidelines for Credit Linked Capital Subsidy Scheme (CLCSS) of the small scale industries have now been modified with a view to extending the scope of the scheme to cover the coir industry. The Coir Board might have popularized the Credit Linked Capital Subsidy.

Up-gradation of skill

9.290 Besides organising training for skill up-gradation in those areas with the involvement of co-operatives/NGOs/ voluntary organizations/self help groups etc. the possibility of providing training through State level Training Institutes also needs to be explored. The Committee was of the opinion that the Development of skilled manpower in the coir industry through appropriate training programmes was one of the plan activities of the Coir Board and was an essential pre-requisite for proliferation of the coir industry in non-traditional areas, where there exist potential on account of raw material/manpower availability. Support for Modernization of the Coir Industry 9.291 The Committee understood that the export oriented industry like the coir industry needs to be supported to adopt modern processing technology, production of value added coir products, diversified uses of coir etc. because adoption of the modern technology will enable the Indian coir industry to supply products satisfying the ever changing taste and preferences of the export market.

Credit – flow requirements 9.292 The Committee recommended that the Coir Board in tandem with the Ministry of ARI should have been coordinated with the Ministry of Finance and the financing institution asking/requesting to provide a handholding support to the coir enterprises concerned for nourishing them at the nascent stage. The Committee hoped that the financial institutions could extended the financial assistance as per requirement to the coir producing states for its promotion and proliferation. Employment Generation in Coir Industries

9.293 The Committee observed that the Coir Board should have focused its efforts for introduction and development of coir industry to the non-traditional areas. It should have been proactively interact with the State Governments for the promotion of coir industry and organize more and more EDPs to promote new entrepreneurs for setting up of coir based units. There was a need to chalk out an action plan. The Committee, therefore, directs the Coir Board to take initialize in this regard.

Millennium Development Mission Document 9.294 The Committee appreciates the efforts undertaken by the Coir Board in drafting the Millennium Development Mission Document and hopes that vision and mission enshrined in the document could been translated in to practice for accelerated promotion and proliferation of Coir Industries in India. It was, therefore, required that the proper strategy should have been chalked out realize the mission of the document

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through adopting/undertaking the required course of action to accomplish cherished objectives set and the Millennium Document. Need was to go by Management by Objectives (MBO) as advocated in the Document and not merely by Management by Activities. (MBA). (n) 173rd report Defining SME Sector

9.295 The Committee observes that World over, policies were being devised to meet the requirement of small and medium enterprises (SME). In India too, adequate steps were required to initiate policies for Medium Enterprises in order to give the SSI units to grow into Medium Enterprises. The Committee was of the view that Government should, at the earliest, delineate and draw the demarcation line between SEs and MEs by providing suitable definition and the mechanism for institutional arrangement, along with the classification of incentive and the exemption required for units of the Small scale Industries and the medium enterprises for their growth and development. The Committee was of the view that for streamlining and strengthening the SSI sector in the national economy, the focus should have been on the providing full credit, technology upgradation, modernization and marketing support to the SSI sector; infrastructure upgradation in general particularly in the major SSI industrial clusters; Freedom from the plethora of rules and regulations existing in the SSI sector, which was known as Inspector Raj; Full support to the service industry to fulfill its true growth and employment. generation potential; and Training of existing ting and potential entrepreneurs and workers on a massive scale ;Modern management practices and skill upgradation through advanced training facilities for capacity building in the SSI sector.

Re-orienting the role of DC (SSI)

9.296 The Committee, in the changing scenario of liberalization and globalisation, feels that the role of the Office of DC(SSI) should be reoriented, broadly on the following lines:- (a) The DC (SSI) could need to be re-designated as the Central Development Commissioner for Small and Medium Enterprises, [CDC (SME)] and he and his organization (Small Industries Development Organization - SIDO) equipped and strengthened to view the sector as a composite whole, without losing focus on the need for generation of employment as well as the specific developmental/promotional requirements and inter-linkages of each distinct component of the composite sector, e.g., tiny enterprises, small enterprises, etc., and the products and services produced by them. (b) The Office of CDC (SME) could need to widen and continuously up-date its knowledge base regarding the global trends in policies and Government interventions concerning the SME sector and recommend and design/implement appropriate measures for continuously enhancing the competitiveness of the sector in India. It could also need to continually ascertain the “ best practices” in this field, within the country and abroad, and appropriately adopt them, through schemes, projects and programmes, to suit the Indian conditions.

(c) The Office of the DC (SSI) further needed to be strengthened its linkages with the State Governments, on the one hand, and with the field offices and specialized institutions of its own and those of other Central Ministries/Departments, on the other, so that the activities of its field offices and specialized institutions were better attuned to the local needs of the SME sector in each State and region, with an eye on the future opportunities and challenges. It could also need to interact more regularly and closely with the associations of SMEs so that the efficacy of various policies and measures adopted and implemented by the Central Government were tested regularly on the ground and refined/modified to achieve the objectives more efficiently.

(d) The Office of DC ( SSI) should have forged stronger links with the relevant international institutions and bilateral organizations so that more effective cooperation between India and other countries as well as India and multi-lateral institutions could be achieved, to derive full advantage of the comparative strengths of the Indian SME sector and to address its areas of weaknesses and concerns, in the light of international experience. Key areas of Massive Action For Revitalization of SEs Cluster Approach : A step ahead towards synchronization of SEs

9.297 The Committee strongly believed that the Small Enterprises could be developed in cluster through the Small Industry Cluster Development Programme. The common facilities like testing, infrastructure such as

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power and roads, assured supply chain and credit should have been provided within the clusters so that these enterprises could grow without any hindrance. The small enterprises must be provided marketing assistance by organizing Vendor Development Programme (VDP) to bring small and medium enterprises on a common platform to decide their marketing strategy and to resolve their problems mutually.

Technology management for SMEs

9.298 The Committee, therefore, was of the considered view that schemes for technology up-gradation for SMEs should have been made more functional and accessible to the existing entrepreneurs as well as the first generation entrepreneurs. Due budgetary provisions should be made for R & D so that outcome of the research work should have been assist the entrepreneurs in cutting the cost of production as well as enhancing the value engineering of SMEs product through product development and product diversification. The Committee recommended that public private partnership approach may be focused by the Government for infusion of latest technology in the SMEs sector.

Broad basing of the ownership of SSI enterprisess

9.299 The Committee observes that majority of SSI units were primarily proprietary concerns. The required investment has been provided by the property owners themselves. Such type of ownership pattern suffers from severe limitations. The main limitation that such units face was in their access to institutional finance and development of the units was restricted by non-availability of finance at the time of need. In order to encourage broad basing of the ownership of SSI enterprises, provision of some additional facilities for units going in for company formation could be considered. The SSI units going in for company formation should have been provided some additional facilities like incentives to form cooperatives, concession to create infrastructure, increase in investment limit etc.

Closer cooperation between large and small scale sector

9.300 The Committee was of the view that a closer cooperation between large and small scale sector was highly desirable to foster the growth of small units as ancillary to large units. Industries associations of both large or smaller units should have beenplay a vital role in creation of such tie-ups and the members of such association may set-up the sub-committees in collaboration with small industry. The Service Institutes should have beenchalk out the programme for encouraging ancillary relationship. The smaller units must be given quality raw material by the larger units for converting the same into quality finwashed goods.

9.301 The Committee was of the further view that Small units performing ancillary role to large industrial units should be ensured prompt and effective payments by large units for supplies made by the SSI units as per purchase order and quality standard. The Committee recommended that the Government should have been come out with Policy framework and sustainable guidelines to encourage ancillary relationships and to safeguard the interests of the SMEs. The Government should have been set up the mechanisms for ensuring that capacities of SMEs as ancillaries were fully utilized while ensuring adherence to quality standards.

Optimum Capacity-utilization 9.302 The Committee was given an understanding that a large number of SSI units were not able to utilize their full capacity due to lack of finance and power shortage including high power rates, lack of demand, non-availability of raw materials, labour and marketing problems. Therefore, the Committee was of the view that availability of assured power supply at reasonable rates, assisting the units in obtaining quality raw materials, assisting them in publishing their products and advising them about new and emerging markets could promote and proliferate SMEs in India.

Human Resource Development for SMEs

9.303 The Committee observed that there were absence of technical persons and trained workers in the SSI sector due to lack of institutional arrangement for preparing trained manpower for the sector, therefore, the Committee recommended that vocational training institutes may be established in each district of the country to impart training and skill for the person engaged in the SMEs sector. The Committee feels that there was urgent need for increasing capitalization of SSIs to enable them to procure better technical equipment, training inputs, marketing management etc. in order to increase the efficiency of the units and their workers. SSI units

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should have been provided facilities for upgrading their technology and also skill of their workers which could result in increasing productivity.

Sunrise Industries in the SMEs sector

9.304 The Committee was of the considered view that the Sunrise industries in the SMEs sector e.g. Information Technology (IT), Biotechnology (BT) Pharmaceuticals and Nano-technologies along with IT enabled services have a strong component in- built. The Committee recommended that the Ministry of SSI should make Action Plan for promotion and proliferation SMEs in these Select Sector. 9.305 The Committee impresses upon the Government should give approval to the proposal of DC (SSI) for the Financial Assistance Scheme for registered small scale / tiny units for adoption of patents in India and abroad to generate confidence amongst small scale / tiny units and enable them to convert an original idea/invention / know-how into working prototype/processes. Strategic Management for Inter-Sectrol Corporation

9.306 The Committee was of the view that the Ministry of SSI should have taken initiative for lodging inter- Sectoral co-operation of Select sectors of economy for promoting SMEs in Steel; garments, Electronics, Food products; leather products; chemical and Chemical products, Railways and Finance. The status of these segments was enumerated as under:- Steel Sector 9.307 The Ministry of Steel could have ensured adequate supply of iron and steel to the small enterprisess through the State Small Industries Corporations (SSICs) and the National Small Industries Corporation (NSIC); 9.308 The Ministry of Steel should have been introduced a mechanism for keeping the prices stable so as to provide iron and steel to the small enterprises at reasonable prices; 9.309 The meetings of the Coordination Committee should have been held regularly to review the availability and supply of iron and steel to the SSICs/NSIC and small enterprises. Garment Industry 9.310 The Committee observed that the supply channel/chain pertaining to raw- materials of Garment Industry must be quick and reliable. In order to reduce the cost of raw material, Government must reduces the excise duty, the Committee reiterates. The small-scale garment units must be assisted in updating to bring them at par with their international counterparts. This could be achieved by assisting such units with high quality testing facilities. Different agencies in charge of developing SSIs must also help these units to improve their organizational methods such as total quality management system and WASO-9000 certification, which was essential for the SSI units to ensure the supply of quality goods in time. The Committee was of the view that information technology was the backbone of apparel industry, therefore, the Committee desired that the information about latest trends and fashions should be collected central organizations or other agency and pass on expeditiously to the manufacturers . Since the Garment Sector exporting garments to U.S.A., Latin America and Europe was facing tough competition from China, Pakistan and Sri Lanka, therefore, it was desirable for the sector to keep on improving the quality of goods and innovate in new designs and products. Requisite competitive resilience should have been injected in garment manufacturing units to enable them to face the challenges created by the WTO regime in transacting the global business. The Committee further recommended that the greater R&D support for the sector should be provided under the guidance of CSIR and SIDBI. Processed foods 9.311 Having observed the vast potential and prospects of Processed food in SSI sector, the Committee had made its detailed deliberation in a separate chapter in this report, however, the Committee wished to pin-point that milk-related items, dried and frozen fruits and vegetable have a vast market but the common complaint was the inadequate infrastructure of transport, cold storage and marketing. The committee was of the view

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that these inadequacies have to be rectified and strict quality controls must be adhered to tap the vast potential of overseas markets.

Leather Products 9.312 The Committee was of the view that the Indian leather industry has not been able to make its presence felt in the international market mainly because of technological obsolescence and was losing to China in cost leadership. Major leather goods manufacturers were also shifting their production centres to south Asian countries posing stiff competition to Indian goods. Another problem for Indian manufacturers was that almost the entire range of machines for making quality leather goods were imported making them costly for small entrepreneurs. The availability of chemical inputs used in leather processing was also limited. Therefore, the Committee feels that leather sector should be made aware of new technologies and excise duty on chemical inputs used for leather processing units be reduced. the committee was of the considered that the ancillary tie-ups of SSI units with large manufacturing houses in the leather sector should be encouraged. Electrical Machinery And Apparatus 9.313 The Committee was of the view that the Electronic industry was one of the most important segments of the small-scale industrial fraternity. Observing the potential of the sector, and associated demands of the products, this sector was required to get into mechanized and automated production with high quality testing instruments. The Committee was of the further view that the government should have been encouraged the Electronic sector to develop sales and marketing strategies to dispose off the variety of goods produced by its manufacturing units. The Committee was also of the view that the Electronic sector must develop ancillary relationships with the larger industries. Adequate assistance and guidelines must be extended the sector for encouraging the units to adopt organizational improvements such as total quality management system (WASO 9000) and ancillary tie-ups of SSI units with main manufacturers.

Chemicals and Chemical Products 9.314 The Committee observed that pharmaceutical sector was now having serious problems due to obligations under the Trade Related Intellectual Property Rights (TRIPS). The manufacturing processes of bulk drugs and drug intermediates were continuously changing with a view to reduce the cost of production and improve the quality of the product. The Committee therefore, recommended that the improved technology could be obtained through continued R&D efforts, technical collaborations and purchase of know-how. The committee understands that small scale units have little capacity for such efforts, therefore, therefore there was the need for the assistance of the Government and national and regional research institutions for providing viable technologies at reasonable cost and training their personnel. National Textile Policy 9.315 The Committee observed that the National Textile Policy aiming at specific initiatives promoting Small Scale and Agro- Rural units in the field of organized e.g. Industry, Power looms, Handlooms, Hand-Knotted Carpets, Silk and Handicrafts. What was required here at was that the concept of SEs had to be re-oriented into a broad -based notion , the first and the foremost step in this regard was to liberate SEs from conventional definition of SSIs. There was no need for SSI unit to remain confined to SSI units just to avail exemption/concession. An awareness programme was to be launched to educate the existing and first generation entrepreneur. Modernisation Schemes For SSI in Textile sector

9.316 The Committee felt that measures required to be taken for improving the woolen industry were Promotion of private sector linkages for marketing of wool; establishing per-loom and post loom-processing facilities; Taking up an integrated development programmes for angora wool;, working on design and process development in a mission mode; systematization of grading and marketing of wool ; Increasing the production of specialty wool , viz., pashmina goat, angora rabbit etc and increasing the quality and productivity of wool in the country.

Key Wereas for Massive Action in Sericture

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9.317 The Committee felt that for further improving the sericulture sector Central Sericulture Board (CSB) should have focused on the areas Improving Research & Development and the effective transfer of technology at all stages; Considerably improving the production of non-mulberry varieties of silk Augmenting efforts for the spread of bivoltine sericulture; Encouraging technology upgradation in activities of reeling, weaving and finishing. Strengthening linkages between the producers and industry and deregulating markets. Periodically reviewing the import policy for raw silk taking into account the balanced interests of the sericulturists as well as export manufacturers.The Committee acknowledged that the Technology Upgradation Fund Scheme (TUFS); Textile Cluster Infrastructure Development Scheme (TCIDS) ; Technology Mission on Cotton (TMC) could go a long way in opening avenues for promoting SMEs in the Textile sector.

Power loom sector 9.318 The Committee felt that Government needs to give impetus to harmonious development of all the segments of the fabric-manufacturing sector. The balanced growth of these sectors should have been achieved basing on their intrinsic strengths and capacity to meet the demands and requirements of the domestic as well as international markets.

Handloom Sector 9.319 The Committee observed that large number of handloom weavers remain outside the fold of the cooperative, and the cooperatives structures were being increasingly weakened due to financial and other mis-management. Therefore, the Committee feels that the Office of the Development Commissioner for Handlooms should have been given impetus to cluster based approach to the development of the handloom sector. The cluster scheme could provide and promote small and medium enterprises in the handloom sector in the ambit of developmental initiatives of the Central Government.

9.320 The Committee felt that Government must continue to accord priority to Handlooms sector. Following Steps should be taken to promote and develop its exclusiveness for the global market training modules may be developed for weavers engaged in the production of low value added items, with the objective of upgrading their skills to enable them to find alternate employment in the textile or other allied sector; Comprehensive welfare measures will continue to be implemented in close cooperation with the State Governments, for better working environment and the social security of the weavers; Effective support systems in research and development, design inputs, skill upgradation and market linkages will be provided; Revamping of Weavers Service Centres will be revamped in consonance with the contemporary trends, and, using Information Technology for efficacy, their activities suitably dovetailed with activities of centres of design excellence like NIFT and NID; Production of value added fabrics may be streamlined; innovative market-oriented schemes should be introduced; and joint ventures be encouraged both at the domestic and international levels. Brand equity of handlooms must be commercially exploited to the extent possible.

Carpets

9.321 The Committee recommended that Government should have been undertaken measures for technology upgradation including indigenisation of machines; development of testing facilities; and use of natural dyes. Adaptation of traditional motifs and promotion of brand image could constitute thrust areas. Handicrafts 9.322 The Committee visualized that to improve the handicrafts sector in the country with more emphasis should have been given on creating employment generation opportunities in rural areas by modifying the existing schemes as under Setting up of local Haat/Mini Urban Haat/Eco Haat as new component of existing Marketing and Marketing Support Scheme; Entrepreneurship Development Programme as new component of existing Marketing and Marketing Support Scheme ; Setting up electronic Kiosk in CFCs being set up in potential clusters to facilitate e-enabled micro credit delivery system, e-supervision and trade through e-commerce as new component of existing Marketing and Marketing Support Scheme.

Cluster Production Method

9.323 The Committee felt that to improve the competitiveness of handicrafts in the International Market, the steps required to be taken include providing commercially useful information and assistance to expoters in developing and increasing exports; offering professional advice and services in areas of technology

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upgradation, quality and design improvement, standards and specifications, product development, innovation etc.; organizing visits of exporters/Export Promotion Councils etc. abroad to explore market opportunities in new and existing markets in Europe, America and other potential markets in Latin America, Africa, ASEAN and CWAS countries; participating in specialized International Trade Fairs; create an awareness through Workshops on “Export Marketing, Procedures and Documentation”, Packaging, Design Development, Buyer Seller Meet, Open House etc. amongst exporters and manufacturers, enabling them to enter into export trade with confidence; setting up of Common Facility Centres equipped with state of art technology in important export clusters; and setting up of Indian Exposition Mart at Greater Noida. Proliferation of SEs through anciliarization of jute industry

9.324 The Committee desired that adequate steps may be taken in regard to improvement of quality of Jute fibre by genetic method and improved retting practice by Biotechnological and other methods. Such measures could give fillip to the promotion of Medium Enterprisess in the country.

SWOT –analysis of Jute Industry

9.325 The Committee was of the view that a conscious efforts may be made for assessing the SWOT analysis of Jute Industry in India and harvesting, marketing and diversification of Jute and Jute Products could have been carried out with the mission as Creation of strong marketing network for better market linkage of raw jute; Providing market information to jute growers in order to enable them to take a decision regarding sale of their produce at market driven price; Implementation of Technology Transfer Programmes for better and quicker retting of raw jute for ensuring improvement in fibre quality; Development of cost effective community retting facilities; Transfer of Technology as discovered after R&D efforts by IJIRA to jute industry and growers.

9.326 The Committee felt further that sincere efforts should have been made in the field of research and development so that new design and technology could be developed for new jute products. Efforts should have been also be made for exploring the international market by conducting market research and development. The JMDC might also be geared up to collaborate with technical institutions in Europe and USA for standardizing the jute geo-textiles, jute agro-textile and jute based compositions. Rehabilitation of sick Jute Mills in India 9.327 The Committee was of the view that for increasing production of value added JDP’s extension of Jute Service Centre and Raw Material Schemes to more areas, development of Standards of quality for JDPs and certification of quality jute products to facilitate the growth of the market for jute diversified products ;strengthen the design and Development Cell of NCJD; Extension of incentives to the manufacturer on production of value added jute products; implementation of a scheme providing higher rate of incentives on export of value added jute diversified products without any ceiling; Government was considering proposal to increase the number of Jute Service Centers and Jute Raw Material Banks operating under NCJD.

9.328 The Committee was of the view that the Government should have been come out with formulation of separate “Jute Policy” on the line of Textiles Policy for giving impetus to Jute Industry in India and giving due consideration to the emerging market - scenario and SMEs . The Jute Policy might incorporate the detailed provisions on the introduction of modern technology machines for higher productivity and quality improvement, implementation of productivity linked wages; removal of Tariff and non Tariff barriers; development of modern technology machines; encourage R&D Institutions in developing value added Jute/jute blended diversified products and machinery required thereof.

Prerequisites For Development Of Food Processing Industries and Support Provided By MFPI

9.329 The Committee understood that the prospects of Food Processing Industry was tremendous in India keeping in view the availability of raw material for various segments of Food Industry. The growth rate to the tune of 7 to 8 per cent in the food processing sector has to be maintained. Therefore, the Committee felt that the Government should have undertake strategic decision / actions for promoting small, medium and large food processing units for promotion and proliferation of food industries in India viz greater impetus to basic development for facilitating food processing industry and paying attention to decentralization of Infrastructural development i.e. food parks, packages centres, optimum utilization of by - products, cold chain facilities, value added centres, irradiation facilities so that balanced regional development of food processing industry may take place in the country; awareness programme for technology up-gradation, establishment of

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modernization of food processing industries covering fruits, vegetable, milk products, meat, poultry, fishery, oil seeds and horticultural sector for adequate and optimum value addition; Special impetus to rural entrepreneurship through Mass Entrepreneurial developmental programmes throughout the country by imparting necessary training and skill; Managing sustainable backward and forward linkages system and linking to ARI sector for ensuring a regular supply of raw material and to workable commercial and marketable system for providing remunerative income to the farmers; For injecting competitiveness to face the global challenges from MNCs engaged in Food Processing Industry, there was the need for maintaining global quality and hygiene standard; Promotion and adoption of WASO, HACP and Good Manufacturing Practices(GMP) standards by the Ministry of Food Processing Industry; Populariziation of processed food through participation in Seminars, Workshops, national, international fairs and generic advertisement for customer awareness; Focused impetus to the growth and development of SMEs in Food Processing Industries throughout the country by providing institutional and commercial support; and Food processing sector needs to take advantage of backward linkages scheme of MFPI so that there were no middlemen / players in between the processors and farmers.

Adequate and timely supply of coal to Small Scale Industries

9.330 The Committee takes note of the fact that Indian Small Scale Industries suffer from inadequate supply of coal to the SSI units. As per the extant policy, the supply of coal to the SSI units falls under the non-core sector. As a result, there has been huge mismatch between the demand and supply of coal to SSI sector. As many of the SSI units require timely and adequate supply of coal for running the units, non-availability of coal has adversely affected to growth of SSI sector.

9.331 The Committee was anguished to note that Coal Companies were not maintaining separate statistics regarding the supply of coal to SSI units. The 16% of coal was supplied to non-core sector consumers including SSI units under sponsorship and linkage based on the Maximum Permissible quantity (MPQ). The Committee feels that the requisite quantity of coal was not supplied under the sponsorship and linkage based on MPQ which was arrived at the average lifting of coal for the past three years, by the units. Coal companies were supplying coal to SSI units on the basis of availability of coal after meeting the requirements of core sector consumers like Power, Cement, Steel etc. and often pro rata cuts were imposed in certain coal companies where availability of coal for non core sector after meeting the requirement of core consumers do not permit the booking under MPQ.

9.332 In the process of examination, the Committee interacted with the representative of SSI Associations/ Entrepreneurs and Coal India Limited and the Department of Coal during the its study visit to Ranchi, on the issue of adequate and timely supply of coal to SSI. Thereafter, the Committee heard the Secretary, Department of Coal and Chairman, Coal India Limited in the matter. Having taken into consideration the mater placed before the Committee and the evidence tendered by the witnesses, the Committee feels that following strategic steps may be undertaken for adequate supply of coal to the SSI units:-

SE sector should be brought at par with the 'core sector' consumers;

9.333 The Coal Companies should establish Depots in each district/State for distribution/marketing of Coal, either by themselves or through outsourcing with adequate accountability on the outsourced entities.

9.334 Direct linkages should be given to the SSI units in all such districts which produce Coal.

9.335 Ministry of Coal may constitute a Standing Advisory Committee and the representative of SSI Associations should also be the member of the Standing Advisory Committee.

9.336 To the extent possible, all the coal consuming SSI should be given coal mines for direct mining in private sector as a matter of reserved mines for SSI sector and it should be made mandatory to any big private mine owner whoever gets coal mine from Government of India to ensure that priority must be fixed for SSI units.

9.337 Government should consolidate the Small Scale Industries in the country by implementing the Action Plan to enable the sector to provide employment generation opportunities to millions of youths in the urban as

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well as rural areas. It was hoped that the suggested solutions could bring some relief to the SSI entrepreneurs in procuring coal.

Concept of Road Railer

9.338 The Committee was apprised that the concept of Road Railer was being developed to facilitate multi- modal transportation which could help the SSI.

Railway as Preferred Mode of Transport

9.339 The Committee was however, constrained to observed that the Railways have done very little to encourage the SSIs to choose railways as their preferred mode of transport. As the rake load (2200-2300 tonnes) was the basic transport unit of the Railways, the SSI units were not able to utilize the Railways for transportation of either the raw material or the finished products due to smaller quantum. The introduction of movement of goods in rake- load/train-load and running of point-to-point trains since 1982 created problems in transportation of raw material/finished product of Small Scale units. Moreover, the closure of 79 marshalling yards between 1985 and 2000 due to rake-load/train-load movement restricted the collection/delivery of smaller loads originating from adjoining sections. Besides bulk volume of delivery were not accommodated at rural stations. The container services of the Railways, which could carry up to 24 tonnes, has also not served the cause of SSI sector due to limited terminals in the country (52 locations throughout the country). Due to these constraints, most of the SSI units have to depend on roads for transporting raw material and finished products.

9.340 The Committee welcomes the concept of Road Railer intended to facilitate multi- modal transportation and hopes that the said measure could help the SMEs in transportation.

9.341 The Committee therefore, recommended that the Ministry of Railways should take immediate measures for providing the needed facilities to the SSI sector for transportation of raw material and finished products throughout the country:-

9.342 Railways should restore the facility of booking small quantities (wagon loads) to help the transportation of SE raw materials and products.

9.343 Bookings at smaller stations should be accepted.

9.344 Adoption of cluster-based approach for better collection and delivery of raw material/finished goods of SEs.

9.345 Railway Board to constitute a Standing Advisory Committee under Chairmanship of Member (Traffic) with representation from Ministry of SSI and Ministry of ARI and select Associations of SEs to devise new schemes for addressing all concerns of SEs.

9.346 The Committee further recommendedthat the Ministry of Railways should have beenenable the SSI sector by providing all possible asswastance for the transportation of SE raw materials and products to strengthen and facilitate to remain competitive in market-led global economy. Keeping in view the potential of Small Scale Industries in India, the Railway Board must reconsider the case of Small Scale Industries and provide infrastructure upgradation in the major industrial clusters for transportation of raw material and finwashed SSI products. The Committee desired that Railways should have beenplay a pro-active role and reach out to the major industrial clusters for providing transportation services to its customers.

Credit flow to SSI Sector

9.347 The Committee expresses its deep concern that credit rate to Small Scale sector as percentage of net bank credit from Public Sector Banks has declined from 17.5% (March, 1998) to 14.2% (March, 2001) and further to 10.4% (March, 2004). Not only this, number of SSI accounts has also declined from 29.64 lakh in 1998 to 16.33 lakh in 2004 i.e. by about 50%.

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9.348 The Committee was of the view that RBI should examine the recommendations contained in the Ganguly Committee Report and issue guidelines to all banks for immediate implementation and thus enhancing the credit to SMEs on reasonable rate of interest so that Indian Small Enterprisess may grow and thrive into Medium Enterprisess.

Restructuring of State Financial Corporations (SFCs) 9.349 The Committee was of the view that restructuring of the States Financial Corporations (SFCs) could go a long way in enhancing the credit to SMEs as per the requirement . The Committee could like to be apprised of the outcome of efforts made by SIDBI through restructuring package to SFCs under MoU.

Enabling Credit to SMEs

9.350 The Committee recommended the following further measures for enhancing credit to SMEs in India : Improving the functional aspects of Technology Bank for SME for facilitating technology transfe upgradation and project evaluation, rwasks management etc ; Re-orienting the role of Regional Rural Banks (RRBs) for extending credit flow to rural Small Scale Industries ; encouraging Laghu Udyog Credit Cards ;and Popularization of credit rating in SMEs .

Global Economy and Generation of Additional Employment

9.351 Considering the higher potential for growth in the SSI sector in terms of output, employment and export, the committee was of the considered that the Government should strengthen and facilitate the SSI sector to enable it to remain competitive in market-led global economy and generate additional employment. In recognition of employment generation potential, the SSI sector has been assigned a target of 12% of annual growth rate and creation 44 lakh employment opportunities in the Tenth Five Year Plan. Keeping in view the potential of Small Scale Industries in India, the National Common Minimum Programme as announced by the Government on 27th May, 2004 stressed on providing full credit, technological and marketing support, infrastructure upgradation in the major industrial clusters and to free the sector from Inspector Raj. But mere announcement could not work. Now the time has come, when the Government should keep its promises of consolidating the Small Scale Industries in the country by implementing the Action Plan to enable the sector to achieve the stipulated 12% growth rate and accordingly provide employment generation opportunities to millions of youths in the urban as well as rural areas.

Erratic And Inadequate Flow Of Credit To SSI Sector

9.352 The Committee was astonished to find the pathetic condition of the SSIs and the erratic and inadequate flow of credit to SSI sector which has been the key reason for continuous languishing of this sector. Although the credit to SSI has increased from Rs.38,109 crore for financial 1997-98 to Rs. 58,278 for financial year 2003-04 - a growth of 53% but what concern the Committee the most was the declining share of SSI in Net Bank Credit over the same period has from 17.5% to 10.4%. No efforts seem to have been taken in the last seven years to arrest the declining trend. It was primarily result of lack of policy initiative by the Government and apathy of banks in particular towards SSI lending. Various factors like high risk perception, higher transaction cost in processing SSI loan applications, lack of credit rating facilities for SSI units contributed further to the woes of Small Scale Industries. Moreover, the non-adherence to RBI guidelines on SSI lending by the banks (e.g. inadequate/ delayed sanction of credit despite guidelines on computation of working capital requirements of SSI units/ prescribed time schedule for disposal of loan applications, insistence on collateral despite instructions from RBI about no collateral for loans upto Rs.5 lakh and upto Rs.25 lakh for units having good track record, etc.) was continuing till date.

Mortality Rate

9.353 The Committee express its concern that it was because of the inadequate credit flow to SSI sector, the mortality rate was increasing year after year and sickness of SSI units was posing a matter of great concern. Moreover, After the deregulation of interest rates regime from 18-20% in 1997-98, the lending rates have come down to around 9-12% at present. As per extant guidelines the banks were required to fix their own prime lending rates (PLRs) and the maximum band over the PLR. The existing guidelines for banks for lending SSI was plus/minus 2% on PLR which translates into a range of 8.25% to 12%. While interest rates

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for Large Scale Industries were negotiable and were generally at sub-PLR. Limiting to the plus / minus two per cent of PLR de-motivated the banks in general to lower the interest beyond PLR minus two per cent.

Declining Net Bank Credit Flow To The SSI

9.354 The Committee observes that the extant course of action and programme as adopted by the banking division and the financial institutions failed to arrest the declining net bank credit flow to the SSI at the reasonable rate of interests. Although, lot of schemes and programmes were being said to be launched for promoting and proliferating the prospects of SSI sector but the declining number of SSI units and increasing number of sick units was a testimony to the fact that Government efforts at present was failing miserably to ameliorate the SSI sector, therefore, need of the hour was to have a focused approach/schemes for enhancing the credit and reverse the trend.

Strategy to ensure time

9.355 The Committee, therefore, feels that the foremost requirement was to extend timely and adequate credit to the SMEs at reasonable rate of interests. The following Course of Action may be adopted by the Government: -

9.356 Treating the Small Scale sector on the priority basis, banks should fix self-set targets of minimum 15% per annum for growth in advances to the SSI sector over the previous year's achievements and in relation to the overall target set by them for growth in their Net Bank Credit for the year. Shortfall in achieving this target should be deposited with SIDBI by the banks at rate of interest linked to "bank rate".

9.357 RBI should issue guidelines to banks to the adopt differential rates of interest under three slabs of loans to Small Scale units as per the following rationalised pattern:-

Upto Rs.1 lakh Not exceeding bank rate plus 1.5% Rs.1 to 2 lakh Not exceeding bank rate plus 2.25% Rs.2 to 5 lakh Not exceeding bank rate plus 3% Rs.5 lakh and above Not exceeding bank rate plus 4%

9.358 RBI should issue effective guidelines to be followed by the banks strictly for speedy revival of potentially viable sick SSI units. Test of viability of sick SSI units should be conducted with attitude to improve the SSI units. Viable sick SSI units should be given an opportunity for debt restructuring whereby the outstanding debt of sick SSI units could be restructured through various forms such as moratorium, rescheduling of debts, infusion of fresh capital, etc.

9.359 Each public and private sector bank to set up at least a "SSI Desk" at each branch under a trained bank official as the Nodal Officer with three years beginning 2005-2006.

9.360 Lead banks to set up Institutes for training of SE entrepreneurs in such districts where major SE clusters were located. 9.361 Government to expand the existing portfolio risk fund to Rs.150 crore in the next five years to enable SIDBI to cover 29 lakh SEs by the end of that period. This could benefit mostly women in setting up micro enterprisess through Self-Help Groups.

9.362 Since SIDBI was meant solely for promoting SSI, there was the need to re-orient its role viz strengthening of State Financial Corporation (SFCs) in a time bound manner with Central/State Government assistance; expanding coverage under industrialization programmes; setting up of a Technology Bank; launching direct finance and Micro- Finance Programmes and setting up of a dedicated credit rating agency for Small and Medium Enterprisess (SMEs).

9.363 While extending credit facilities Bank should be advised to observe the credit history of the entrepreneurs and accordingly fix the volume of credit, rate of interest and mode of repayment.

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9.364 RBI, banks and other financial institutions should change the mindset in order to really promote and proliferate SMEs so that Indian SMEs should not lag behind the global trend.

Credit Flow to Medium Enterprisess 9.365 The Committee hopes that the Annual Monetary & Credit Policy 2005-06 could go a long way in providing credit to Indian SMEs as per the requirement of SEs and MEs sectors and RBI's this year's announcement for credit policy could not prove mere annual rituals. The Committee firmly believes that RBI could issue suitable guidelines and adopt and adhere resilient monitoring - mechanism for implementation of stated objectives in the credit policy 2005-06, otherwise, policy could remain mere window-dressing or arm- chair- intellectual exercise. The Committee recommended that the policy must go beyond the formulation stage so that it may be implemented in practice. Legal framework affecting the Small Scale Industries was satisfactory

9.366 The Committee understands that the plethora of laws, rules and regulations and the burden of inspections under these, have affected the SSI sector adversely. Therefore, with a view to simplifying and streamlining the system of inspections under these laws, and also reducing the burden of statutory returns/ registers prescribed hereunder, Small and Medium Enterprisess Development Bill, 2005 (earlier referred to as the Small Enterprisess Development Bill) must be enacted without further delay. Following measures were therefore required to be taken in order to give fillip to the promotion and development of Small Scale Industries: - A single Unified Act governing the rules pertaining to retrenchment and layoffs and social benefits for employees. Enactment of Single Comprehensive Small Enterprisess Development Act for SSEs similar to the Industrial Development and Regulation (IDR) Act. Comprehensive Social Security Scheme for widening the social safety nets as proposed in SED Bill. Since the Inspector Raj was causing severe harassment to Small Scale Units, therefore, the provision made in the proposed legislation for giving good bye to Inspector Raj to wipe out the tyranny of Inspector Raj.

Public- Private Partnership in regard technology up gradation for the SMEs

9.367 The Committee was of the view that in order to promote Public-Private Partnership for technology upgradation under the Schemes monitored by SIDO, awareness of the provisions of the schemes among the Industry Associations could have to be increased. Further, Associations need to be guided for identifying the felt-needs of SSIs and chalking out the operational modalities of such common facilities so as to enable them to prepare project proposals, which were technically sound and financially viable.

International Co-operation between Indian Enterprisess and SME abroad: "Key areas for Mutual Co-operation". 9.368 The Committee was of the view that the Institutional support could be utilized further, in promotion of SMEs through assistance in:- Developing and implementing a technology transfer strategy, in addition to financial, marketing and operational strategies. Conducting of technology audits for and benchmarking and assessment of technology needs. Technology sourcing and acquisition and applications of new techniques Identification of new export markets by encouraging their participation in sector specific exhibitions. Raising equity participation from the existing 24% to 49% (FDI) in SSI sector

9.369 The Committee was of the considered view that the Department of Industry Policy and Promotion (IPP), Ministry of Commerce & Industry may explore the possibility of raising equity participation in the SSI sector from the existing 24% to 49% (FDI) for better technology transfer in SSI sector in which FDI could be encouraged for sizeable investments towards larger returns.

Enactment of Limited Partnership Act

9.370 The Committee in in agreement with the opinion of the Ministry of SSI that the Limited Liability Partnership will provide higher flow of capital in to the Sector, especially to the upcoming sections like IT, Bio-technology, Pharma, etc and could also encourage venture capital, therefore, the committee

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recommendedthat the Ministry of SSI should have beentake up the matter of Enactment of Limited Partnership Act with the Ministry of Company Affairs.

Protection Of SMEs Under WTO Regime

9.371 The Committee was of the considered that emerging SMEs in India should be protected from the on-slaught of Frankstein MNCs who were launching its monstrous head -way to Indian market due to opening of economy under WTO-regime in order to fulfill the commandants of liberalization and globalization by undertaking following strategic decision and action: -

-Strengthening of Anti-dumping mechanism ; -Conversion of Quantitative restriction (QRs) into rationalised tariff regime; -Rationalisation of countervailing duties and safeguard duties to protect domestic; -Awareness among SSI entrepreneurs about India's obligation under WTO regime; and -Expeditious disposal of dumping cases were anti-dumping actions thereto.

Strengthening The Institutional Framework

9.372 The Committee was of the view that the government should take initiatives like strengthening the institutional framework with decentralized set-up throughout the country , formulation , coordination and ensuring the implementation of policies and programmes for Small and Medium Enterprise (SME) Sector, providing sensitization programmes in respect of the needs of the fast changing economic scenario and ensuring dissemination of information, cluster oriented Infrastructural development, trade specific measures, market assistance and simplification of rules and regulations for promotion and development of the SME Sector. Service enterprisess, fast growing trades like IT, Pharma, biotechnology etc. needs special attention.

Policy Package To Boost The SME Sector

9.373 The Government should bring forth a policy package to boost the SME Sector, which inter-alia must contain the provision of enhancing the investment limit of small enterprise providing the policy, credit, technological and market support, infrastructure development to pave a way for small enterprisess to graduate to medium and to boot the SME Sector. Moreover, the Small and Medium Enterprisess Development (SMED) Bill, 2005 must see the light of the day at the earliest.

(o) 174th report Prime Minister Rozgar Yojna (PMRY)

9.374 The Committee was not at all satisfied with the performance of PMRY in the States of Jharkhand, Bihar, West Bengal and Maharashtra, although slight improvement has been there during 2004-05 as compared to the last year for the corresponding period. The Committee observes that it was desirable that Ministry of ARI in tandem with the Ministry of Finance, banks and state Government should have been keep monitoring over timely and effectively implementation of Schemes under its purview and accordingly apprise the Committee.

9.375 The analysis of the performance under PMRY during the last three years based on the reports received from RBI shows that besides other reasons, performance under the Scheme in States was positively correlated with the recovery of loan over dues under the Scheme. Other reasons for failure of Scheme were competition from Central/State Govt. Schemes offering higher subsidy, difficulty in getting the desired target group due to higher level of per capital income, non viable projects, reluctance on the part of banks to sanction and disburse loan, militancy, etc. The Committee, therefore, was of view that the Ministry of ARI in tandem with the banking division, Nationalized Banks and the State Governments of Bihar, Jharkhand, West Bengal and Maharashtra should have been taken suitable steps ensuring compliance with yardsticks for better functioning of PMRY in these states such as Minimising the rejection ratio by banks against no. of application received; Avoiding the stoppage/delay of disbursement in PMRY loans on flimsy grounds ; Quick disposal of

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application on the part of DICs and forwarding the same to banks; Coverage of SC/STs under the scheme as per the norms stipulated by Government of India ;timely communication of targets to banks for necessary action on their part ; effective orientation programmes conducted by DIC for the target groups at Block/Taluka level to enlighten /popularization of PMRY; and ACCORDANCE to the provision of PMRY for advancing loans in the ratio of 50%; 30% and 20% in respect of industry, service and business sector.

Working of Khadi Industries in West Bengal, Maharashtra, Jharkhand and Bihar

9.376 The Committee desired to know the reasons for drastic reduction in funds allocated for khadi programme for Bihar which has been earmarked to the tune of Rs.160.70 lakhs in B.E. 2005-06 in comparison to Rs.346.51 lakhs during 2004-05. The Committee recommended that in the case of shortfall in the fund, the required Budgetary support may be sought at the R.E. stage so that the course of action under the scheme should have been not suffer. Similarly, adequate funds may also be made available to Jharkhand and Maharashtra.

9.377 The Committee acclaimed the status of West Bengal for ranking the top position in the muslin Khadi production singularly contributing 55% of total national production of Muslin Khadi in the KVI sector. Not only this, Muslin Khadi attracts large scale employment of women artisans which provides additional opportunity for empowerment of women. However, the Committee desired that the State must continue to be an ambassador of India's culture and traditions and unique art and craftmanship of the state such as Mulberry Cocoon of Malda, and Muslin Khadi of Nadia and Murshidabad must continue to dominate the global market harnessing not only the foreign currency but also fostering India's enriched culture to the world civilisation. But, to translate such rosy aspiration into reality the state Government and the Central Government has to work hand-in-hand coordinating and implementing the programmes with utmost honesty and sincerity. 9.378 The Committee was of the opinion that since Maharashtra has been the leading state for economic activities, it was utter surprise that out of one hundred three khadi institutions, eighty two Khadi institutions fall into the 'D' category. The Committee was constrained to note that the achievement in the state has been much less than the targets set out in action plan. KVIC has to look into the reasons and do its best to achieve the desirable results. The KVIC should have been therefore, initiate appropriate steps for improving the Khadi industries in Maharashtra where Khadi was doing its business far below the level of expectation. The Ministry of ARI should have also intervened and appropriate directions should have been issued to chalk out Action Plan for promoting and proliferation of Khadi Industries in the State. Bihar: an industrially Backward State

9.379 The Committee understood that in post partition phase (since the year 2000), Bihar remained an industrially backward state with insufficient and poor infrastructure development , inadequate supply of power, low capital flow, adverse C.D. ratio. The announcement of new industrial policy had not made any observable headway. The Committee, therefore, was of the view that the Central Government in tandem with the state government has to start from the stretch for launching effective industrial growth and development of the state. Since the state has largely been remained an agricultural state. A new beginning could be made in the areas of Agro -rural industries by initiating course of action viz. due impetus to anciliarisation of Jute industry in Purnea, Katihar, Araria, and Kishanganj to extract benefits of opening up of Katihar Jute Mills; De-centralisation of setting up of software technology park in each district of the state; Promotion and proliferation of tea processing units in Kishanganj, Purnea and Araria; Institutional and logistic support to Agro -Rural Industries, specially Sugar Mills and its backward linkages; co-ordination with Central Silk Board (CSB) for development of TAsar, Mulberry, Eri development in Bhagalpur , Banka, Jamui, Purnea and Kishanganj; Promotion of Handloom and powerlooms programmes for development of clusters of weavers, establishment of work shed at Panchayat level of each districts. Government may approve the composite schemes for development of Handloom and sericulture in the state; and having regard to the fact that Bihar was an industrially backward state, the special package announced in 1997 for industries in the North-East by the Union Government and for Utranchal and Himachal Pradesh recently, needs to be provided for Bihar at the earliest. 9.380 The Committee was of view that Bihar, after the partition and separation of Jharkhand, remained basically an agricultural state, that too not very organised, and the state being bereft of any large scale or even medium scale industries, the only option that remains with the state was the accelerated promotion and proliferation of agro - rural industries and Small Scale and Medium Enterprises which have the benefit of requiring low investment and providing vast potential for employment generation. Therefore, the Committee strongly recommended that the Ministry of ARI and SSI should have been come together in chalking out

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district- wise Development Strategy, based on availability of raw material, for promotion and proliferation of agro-rural industries and SMEs in general and Khadi industries in particular so that the state may come out of its present status and contribute to the national economy. It was also desirable that the people and the Government of Bihar must prepare for putting back the state on the track. The Ministry of ARI should have coordinated with the State Government for procuring basic information for chalking out total planning for promotion and furtherance of Khadi and Village Industries at the Punchayat level. Serious efforts should have been made for revival of khadi centres at Kajha and Ranipatra in Purnea, Tassar silk in Banka and Bhagalpur district and commercial marketing of Madhubani paintings.

Outstanding Dues 9.381 The Committee was apprised by the state khadi commission that the state Government owes outstanding dues on account of the rebate amount suppose to be reimbursed by the State Government. The committee, therefore, desired that the Ministry of ARI should co-ordinate with the State Government for releasing outstanding dues to state KVIC at the earliest.

Capitalisation The Potential Of Khadi Industries

9.382 The Committee was of the considered view that the Ministry of ARI should have been made all out efforts for capitalising the potential of Khadi Industries particularly the Tassar Cocoon in Singhbhum and Dumka and Woolen Khadi in Palamu district. The Committee during its study visit has observed that state KVIC was working under dynamic management and leadership, therefore, a little guidance and direction on the part of Ministry of ARI and KVIC could go a long way in the promotion and proliferation of Khadi industries in the State.

Specific problems being faced by Village Industries in Bihar, West Bengal, Maharashtra and Jharkhand

9.383 The Committee observed that Jharkhand being a newly created state requires further strengthening of infrastructure as well as institutional base. The functioning of State KVIB also needs to be further streamlined for taking up village industries programmes at a large scale. In the State of West Bengal, the institutions were suffering from liquidity crisis because of non-realization of sundry dues from the parties in time, blocking working capital which in turn disrupts the production process; in Bihar the main problem was the lack of liquidity because of poor marketing, poor quality of products and inappropriate packaging and in Maharashtra there were very few number of institutions implementing village industries programme.

9.384 The Committee observes that village industries were suffering because of lack of basic infrastructure in Bihar and Jharkhand, lack of working capital in West Bengal and Bihar and insufficient institutional support in Maharashtra, therefore, the Committee directed that the Ministry of ARI should have been undertaken activities for improving village industries in West Bengal, Jharkhand, Bihar and Maharashtra including Make state-wise; SWOT analysis of the village industries chalking out of state-wise development strategy for encouragement to village industries. Development strategy in each state should have been fragmented district-wise depending upon the availability of raw material in each district; Co-ordination with Planning Commission and financial institution for providing adequate working capital; Coordination with state Government for facilitating basic infrastructure; allocation of suitable funds for research and development for product diversification and innovation; Providing adequate and proper institutional support and encouraging the entrepreneurs to adopt updated technology and practice modern managerial skill. 9.385 The Committee desired that the Planning Commission and Ministry of Finance should have sympathetically considered the cases of Bihar, Jharkhand, West Bengal and Maharashtra where was need to earmarked sufficient fund for the promotion of village industries on fast track.

Working of REGP in West Bengal, Jharkhand, Maharashtra and Bihar 9.386 The Committee was of the considered view that for achieving the employment target under REGP during the year 2005-06 in Bihar, West Bengal, Jharkhand and Maharashtra the course of action required to be taken were allocation of district-wise/bank wise targets; 40 per cent of the total target to be earmarked for Food and Agro Based Industries ; 30 per cent of the total project to be earmarked for Women Entrepreneurs; Workshop, Awareness Camps and REGP Exhibitions in 2005-06 to popularize the scheme among rural people as well as banks. The Committee was pleased to note that State Level Task Force Committee has been constituted in each State of Bihar, West Bengal, Jharkhand and Maharashtra under the Chairmanship of the

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Secretary (Industries of the State Government) for better monitoring of the scheme. The Committee desired that at state level nodal officers must look after the overall implementation of the schemes and its progress. Organizational overhauling and institutional framework for better implementation of REGP especially in Bihar, Jharkhand, West Bengal and Maharashtra 9.387 The Committee was apprised that Small Projects upto five lakh rupees were being encouraged, however, the Committee desired that the bank-wise/District-wise targets should be allocated and Sector (Group) wise implementation of REGP be encouraged. Further Social Sector-wise distribution of target, Coverage of new areas uniform coverage of regions/industries, Organizing more exhibitions, Introduction of PRODIP Scheme, Organizing Buyer’s Seller’s meet, involvement of Self-Help Groups in implementation of the scheme must be encouraged. The Committee desired that the role of Ministry of ARI must be more effective in implementation of the scheme in terms of monitoring, coordinating, providing necessary guidance and liaisoning with other Ministry and organizations especially in Bihar, Jharkhand, West Bengal and Maharashtra, where aggressive popularization of the REGP was required. Formulization of Rural Entrepreneur Development Programmes 9.388 Since the State KVI Boards were major agencies involved in the implementation of REGP, the Committee recommended that the concentrated efforts should be made for strengthening of infrastructure/organizational structure because the same often prove hinders in the expeditious implementation of the scheme. The Committee desired that the Government should make efforts for coordinating with the KVIBs and KVIBs in Bihar, Jharkhand, Orissa and Maharashtra must be revitalized by their respective State Governments.

9.389 The Committee was also of the view that efforts should be made for formulation of Rural Entrepreneur Development Programmes especially in Bihar, Jharkhand and West Bengal where large chunk of population dwell in the rural areas and where the KVIC's entrepreneur promotional schemes and training programmes have not seen the light of the day. The Committee, therefore, recommended that effective Action Plan should be chalked out and result- oriented implementation of the programmes must be monitored. The Committee further recommended that an all out efforts must be made for changing the mind-set of financial institutions to boost REGP and setting up of monitoring cells at Regional /Zonal offices to monitor the progress of REGP. (p) 175th report Micro analysis of problems and prospects of SSI : Orwassa

9.390 The Committee interacted with the representatives of Orissa Industries Association and Orissa Young Entrepreneurs Association in the presence of representatives of Ministry of SSI, Government of Orissa and the Banks. The Committee came across that Orissa was having only 2% of SSI units in India and the share of Orissa in total Bank finance to SSI units was only to the tune of 1.08 %. The associations pointed out solutions for improving SSI sector in the state .The rehabilitation package should have been implemented promptly within a time frame to revive the unit. It was fact that inadequate finance and untimely finance by the banks whether term loan or working capital was responsible for sickness of SSI steps should be taken to strengthen the forum of SLIIC and the promotional agencies and the financial institution to do pro-active role to overcome the difficulties faced by the units. As SSI units in Orissa were affected badly due to super cyclone, a special liberal package to the affected units by extending all types of concession, and also extending the period of repayment should be drawn in consultation with Reserve Bank of India. Priority should have been given by Nationalized Banks to finance potential SSI unit in a particular area. Compromised settlement of NPA : As the response from SSI unit in Orissa for NPA settlement was encouraging. So more time should be given to cover more number of NPA units. Different financial linked schemes like CGTSI, CLCSS, NEF, Composite Loan scheme, SME fund of SIDBI Should have been popularized in Orissa as most of the entrepreneurs were not aware of these schemes. The innovative financing like venture capital, factoring services etc. should be popularized which will improve the position of the unit to get finance easily. Orissa State Financial Corporation which was the chief term loan provider to SSI unit in Orissa was in urgent need of financial restructuring, so as to clean up their balance sheet. The mechanism of state government, SIDBI and the IDBI have to play a proactive role in this. There should have been a liberalised OTS Policy by Financial Institutions for sick SSI.The forum of State Level Inter Institutional Committee i.e. SLIIC should be made more effective. The decision of the SLIIC should be made compulsory implementation by other agencies concerned with revitalization of their units. The Committee was informed by the representative of

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Orissa State Financial Corporation Employee's Union that certain relief an concession may be granted to the state:-

(i) Impress upon the SIDBI/IDBI/Commercial Bank to waive the entire interest that has accrued on Financial Assistance to OSFC w.e.f. 1.11.99 to 30.06.2004.

(ii)The interest payment of Rs.160.53 crores already made by OSFC to IDBI/SIDBI/ Banks may be adjusted against principal liabilities of these institutions after such waiver of interest.

(iii)To impress upon SIDBI to continue with refinancing under SMEs Fund, which was already made available to SIDBI by the Union Government.

(iv) Development strategy for promotion of SSI units in economically backward district like Bolangir and Koraput, Kalahandi and extension of income tax and central Excwase exemption on the lines of North East and Uttranchal and Himachal Pradesh. 9.391 The Committee observed that Orissa demonstrates a paradoxical picture of poverty amidst plenty as the state, despite having mineral and marine resources, has been bereft of sustainable industrial growth and economic development. The Committee found that the cherished Charter of the Planning Commission which was "to combine a rapid rise in the Standard of living of the people by efficient exploitation of the resources of the country, increasing production and offering opportunities to all for employment in the service of the community", has not seen the light of the day in the state. The state has been devoid of planned development giving rise to the economically backward district like Bolangir, Koraput and above all the Kalahandi. No major efforts have been made to put the state on the industrial development track, and therefore there was the lack of ancialirisation of industries in the Small and Medium sectors. Besides, the general problems like lack of Infrastructural development and marketing assistance and shortage of timely and adequate credit flow etc., the state has also been the victim of natural calamities like super cyclone in 1999 which have actually devastated the Small scale industrial set up and thus arrested the industrial growth and promotion and proliferation of small and medium enterprises in the state. The Committee, therefore, was of the view that the financial institutions should have been come forward for providing timely and adequate credit flow to the entrepreneurs for accelerated industrial growth and promotion of SMEs in the state. The Committee recommended that concerted efforts must be undertaken for popularization of venture capital, factoring services and other financial linked schemes like CGYTSI, CLCSS, NEF and SME Fund of SIDBI.

9.392 The Committee further recommended that certain key areas must be selected for effective action which could include Strengthening the functional aspects of state level inter-institutional Committee (SLIIC) and promotional agencies; Financial restructuring of Orissa State Financial co-operation by seriously considering the proposal of adjustment of interest payment to the tune of Rs. 160.33 crore against principle liabilities besides wavering of the interest; Extension of income tax and central excise exemption for setting up of SMEs in economically backward districts like Bolangir, Koraput and Kalahandi on NER, Uttranchal and Himachal Pradesh line ; Special liberal package to super cyclone effected SSI units like rehabilitation package and one time settlement (OTS). Gujarat 9.393 The Committee interacted with the representative of Ahmedabad Foundry Cluster, Morbi Chamber of Commerce & Industry, Wadhwan Industries Association, The Gujarat Dyestuffs Manufacturers' Association and Gujarat Chamber of Commerce & Industry. The SSI Associations, as a whole suggested for improving the status of SSI units with the following strategy :- (i) Rate of interest being charged by lending institutionals/banks to SSI be fixed at Bank Rate plus 2.0% for term loan and 4.0% for working capital. (ii) Moratorium on repayment of term loans provided to SSI units should be at least two years from the date of first disbursement and repayment should be spread over a period of 6 to 8 years. (iii) One Bank Branch in every District catering exclusively to SSI. (iv) Operation of the Technology Development Modernisation fund scheme administered by SIDBI be extended to five years instead of three years. (v) National Equity fund of SIDBI covers projects upto Rs.25 lakhs. It was proposed that this limit be raised to Rs.1.0 crore. (vi) The one time Settlement scheme should be extended for period of another 3 years with simplified norms i.e. installment for payment of dues should be extended to 36 months.

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(vii) Non Performing Assets (NPA) was considered on 90 days non payment of Interest/installment should be raised to 180 days as most of the SSI units were realising their proceeds after a period of 5 to 6 months. (viii) Revival of Co-operative Banking Sector. (ix) Exit Policy for the entrepreneurs of SSI Sector which provide. (x) Exit from the business. Provisions of Insolvency and Bankruptcy Act as of the developed world. (xii) One time settlement scheme which expired on 31st December, 2004 should be extended for another two years and 10% down payment should be asked instead of 25% from the entrepreneurs taking benefit of scheme. (xiii) Restoration of S.S.I. Exemption on small scale ceramic to stand erect in cutthroat competition by large-scale industries. (xiv) The small Scale Unit, desiring modernisation by importing machineries form abroad should be given exemption from payment Custom Duty. (xv) Grant loans at lower rate of interest for modernisation of S.S.I. Ceramic Unit and (xvi) A passenger train from New Bhuj to Bareily via Morbi. 9.394 While the Committee was pleased to note the impressive development of Small Scale Industries in Gujrat, as almost ten thousand new SSI units were registered each year, however, the Committee feels that the Ministry of SSI should act promptly in co-coordinating activities with state Government, Banking division and steel sector for combating the problems of inadequate credit flow, lack of infrastructure development and inadequate supply of steel in the engineering segment. The Committee recommended that the Ministry of SSI should invite from the state Government proposal under Integrated Infrastructural Development (IID) Scheme. Adequate impetus may also be given for covering more cases under cluster development approach in the state. The Committee further recommended that the Ministry of SSI should co-ordinate with the steel units in public and private sector for ensuring timely availability of steel raw material to SSI units in the state. The Committee desired that the proposal of extending the operational period of Technology Development Fund Scheme from 3 to 5 years may be suitably examined. Problem being faced by SSI Sectors in Karnataka

9.395 The Committee was apprised that the five Year "Perspective Plans" have been prepared by all the 27 Districts Industries Centres in the State highlighting mineral, agro and human resource potential of the Districts. Keeping in view the needs of the industry, the following strategy may be adopted for promotion of SSI units: - (i) Financial assistance from Govt. of India towards industrial infrastructure projects, up gradation of surface transport infrastructure, augmentation of railway network and connectivity to ports, upgradation of New Mangalore Port and assistance for expansion of Karwar Port (under Govt. of Karnataka). (ii) There was a backlog of Rs.429 crore of State Investment Subsidy payable to SSI units in the State. Government of Karnataka. Suitable ways and means advance/interest free loan from Govt. of India to liquidate this arrears preferably in one or two installments. (iii) Early approval of Govt. of India for the industrial clusters proposed. (iv) Early approval of Govt. of India to locate the Automotive Testing Facility in Bangalore/ Dharwad of Karnataka. (v) Special Economic Zones Development Bill 2003 may be expedited; (vi) In addition to manufacturing exports, software and services exports from the State also be considered for the purpose of determination of quantum of financial assistance to States under ASIDE scheme/Indian Institute of Technology (IIT) at Dharwad may be favorably considered. (vii) Central assistance for setting up of minor airports in uncovered destinations like Mysore, Bellary, Bijapur, Hassan, Karwar, Hampi, etc. could facilitate both industrialization of backward areas as well as tourism sector. 9.396 The Committee observed that Karnataka was becoming the hub for proliferation of sun rise Small and Medium Enterprises units in the field of Bio-technology, Electronic, Soft ware, the Committee, therefore, recommended that the State should have been given top priority for encouraging investment in specific sectors in those select sectors viz. Pharma, Automobile and Auto components, Textile, Garments, IT, ITES, Sugar, Food Processing, Engineering and Metallurgy (Iron & Steel and Cement) with greater R&D impetus for accelerating modernization and up-gradation of mining processing technology. The Committee desired that the outstanding dues to the tune of Rs. 429 crore at state investment subsidy must be reimbursed to the state SSI units at the earliest. The Committee was of the view that the concerted efforts should have been made for appraisal of Agree Exports zones at Chitradurga, Kolar, Bangalore, Tumkur and Bijapur. The Union

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Ministry of SSI should have been also undertake promotion of Industrial Development through Cluster approach in select districts. Action Plan should have been also be chalked out and effectively implemented for industrialization of backward areas for balanced industrial development in the state. The Committee felt that Union Government in tandem with the state government should have given due emphasis on implementation of industrial infrastructure projects, up-gradation of surface transport infrastructure, augmentation of railway network and connectivity to ports and up-gradation and expansion of Mangalore and Karwar ports. Bihar 9.397 The Committee was of the view that basic infrastructure like Cold storage Chain, Research Development, Manpower Development, Improvement in quality of products, Packaging, Improvement in logistic, Ware House, Quality and Testing Lab were required for achieving proposed Food Processing Industry . Reasonable central subsidy for the development of basic infrastructure for food processing industry in the state may be provided. The Committee impress upon the Ministry of SSI to take up the matter with Ministry of Food Processing Industry for promotion of the industry. 9.398 The Committee was pleased to note that Bihar has the potential for Agro based industries, fruits and vegetables, therefore, the Central Government should have been open Food Park in the potentially identified districts of Bihar and a Nodal Agency for promoting SMEs in these areas should be set up for regulating food processing units and undertaking research and development activities. Opening of a branch each of Central Food Research Institute, Agriculture Science Centres with advanced technology and APIDA could prove paramount in the promotion and furtherance of SMEs in the state.

9.399 The Committee has been apprised the vast potential of handicrafts in the state, therefore, an all out efforts should be made for the encouragement and furtherance to the handicrafts in the state. A detailed strategy should be chalked out for promoting handicrafts as per the availability of raw material / opportunities viz. Madhubani Painting in Darbhanga and Madhubani; Store Chipping in Gaya and Aurangabad; brass and bell metal in Nalanda, Gaya and Patna; Siki Product in Sitamarhi and Madhubani; Terracotta Craft in Darbhanga and Muzaffarpur; Jute in Kathihar and Purnea; lac bangles in Muzaffarpur and Darbhanga; Capur, Durri in Obra (Aurangabad) and bamboo articles in Patna, Hajipur and Bhagalpur. Special package

9.400 The Committee desired that in order to generate industrial atmosphere in Bihar and to overcome the requirements of raw materials, the Government of India should provide special package to the state for accelerated development and growth of SMEs in various segment of industries:-

Name of Projects Cost of Project

(in crores)

Development of Industrial Werea & Growth Centre 100.00

Development of Entrepreneurship and skills 5.00

Biotechnology Park 25.00

Venture Capital Fund 100.00

Development of Food Processing Industries 25.00

Tea processing industries 10.00

Rehabilitation of sick industries 500.00

Development of handicraft 10.00

Total 775.00

9.401 The Committee was of the view that in the changing scenario of increased industrial activity, there was need to impart more training to the entrepreneurs of the state in the field of Management, Cost effectiveness,

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Financial Management, advertisement and publicity, patent laws, new technologies in marketing, Inventory Management etc. To have the global standard of entrepreneurship there was a need to provide additional basic Infrastructural facilities so that the entrepreneurs of the state could be trained with such a high quality management training inputs which at later stage could be so strong that the identity and existence of entrepreneurs could be not effected by the influence of World Trade Organization.

Status of Power supply to Industries

9.402 The Committee interacted with the representative the Bihar Chamber of Commerce. The Committee was apprised that suitable action plan may be sketched for providing timely and adequate for supply power to the state for intensive industrialization of the state. Besides to promote the SSI sector in Bihar the following steps may be taken:-

(i) District- wise development strategy for promotion of SSI sector keeping in view the geographical distribution of raw material.

(ii) Setting up of institutional arrangement to facilitate promotion of SSI sector by the new entrepreneurs.

(iii) Need to change mind set of state Government agencies, Banks and financial institutions and entrepreneurs towards industrialisation of the states. The union Ministry of SSI in tandem with state government agencies and the Banks/Financial Institutions operating in Bihar may take initiative for development of infrastructure in the state.

(iv) Providing incentive such as tax concessions etc. to encourage entrepreneur to start industries.

(v) District Industry Centres should organise programmes to entrepreneurs about various types of services and facilities being offered by the banks.

(vi) Banks should have been look into the feasibility of opening specialised SSI branched and/or industrial branches for smoothening flow of industrial credit particularly by lead banks in Bihar.

(vii) The recommendations of Nayak Committee (1991), Kapur Committee (1998) and S. S. Ganguly Committee should be implemented effectively by banks and financial institutions in the State through assistance of the District Industries Centres for identification of Small entrepreneurs.

(viii) Need for setting up of Venture Capital Fund in the State for Small Scale Industries and for information Technology separately.

(ix) Branch managers should have been intensity their visits in the service area to create a better rapport and mobilise viable projects with an attitude of the economic development of the area and Loan applications formats be made available on the Notice Boards of bank branches. 9.403 The Committee felt that that the State Government should have been implement the provisions of State Industrial Policy enunciated recently for promotion of Small Scale Industries in the State. Thrust areas for Development in SSI Sector

9.404 The Committee interacted with various SSI Associations and suggestions which came forth for improvement in the status of SSI sector which featured as re-classification of the SSI Sector into Micro, Mini and Small office and home office; uniform Electricity tariff across India, especially for Micro and Mini Units ;Amendment of Delayed Payment Act, and Limited Partnership Act for SSI; accredited SSI Managers; social Security for Workers & Owners Special rights for SSI Entrepreneurs', separate Advisory Body for the Agro & Rural Industry Ministry; Installation of Pollution Control Devices ; advertisement of SSI Products; implementation of Cluster Scheme at Khagraghat, Murshidabad, Powerloom cluster in Nadia. Insurance facility for Small Business Sector and Recovery of Loans from Micro & Mini Enterprises ; separate Incentive Scheme for Micro & Mini Units and Separate category of Small Office & Home Office. 9.405 The Committee recommended that the Union Ministry of SSI in co-ordination with the State Government of West Bengal should have been under taken concrete measures for further proliferation of leather industry by relocating the leather tiny units at suitable places and providing adequate institutional and logistic support for enhancing production and export of leather products.

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9.406 Taking into consideration the vast potential of handicrafts in the state, the Committee recommended that the Union Ministry of SSI, ARI and Textile in tandem with State Government should have been encourage the weavers and crafts men of the state for developing and diversifying a rural products in the handloom and handicraft segments.

Jharkhand

9.407 The Committee was further apprised that the certain strategy might have been adopted for promoting SSI sector in the state which included a Special Central package was urgent need for sick and closed SSI and existing sick and closed units be rehabilitated `As was where was basis' ; Provisions for more soft financing policies was required and direct incentives to the Sulking Industries; Insured electricity for at least 18 hours was basic need; the balanced Regional Industrial Development was required to prevent further Socio-detoriation of Santhal Pargana; Setting of Milk Processing, Fruit Processing, Vegetable Processing, Spice Processing, Harbals based Units, Food Processing Industries in the view of Local Market as well as overseas market also; Special Economic Zone (S.E.Z.) with all latest facilities for promotion of maximum investment opportunity, export activities and economic development of Santhal Pargana region ; Data Bank for mineral deposits in Santhal Paragana so that mineral based units may come out ; Adequate impetus on Infrastructural development like road and bridges, power, water supply ; capital subsidy reimbursement and central government subsidy for food processing industries ; impetus on farming of timber for reducing pressure on reserve forest, environment and better ecology, creation of job opportunity and boosting industrial activity based farm timber ; cost effective, timely and adequate availability of institutional finance ; adequate availability of energy at comparatively cost ; Prevention and cure in sickness in SSI sector if a legislation like SICA Act was made empowering the State Governments for formation of bodies like BIFR at state level, with statutory powers for approving and implementation of package for revival of sick SSI units ; a comprehensive law should be made to govern all matters related to Small Scale Industries; labour laws have to be relaxed to enable SSI sector to fire the erring and make itself more competitive and cost effective.

Andhra Pradesh

9.408 The Committee was pleased to note that Andhra Pradesh was the First State to have the "Single Window Industrial clearance System" and thereby recommended that other states should follow the suit for the actual furtherance of SMEs. However, the Committee stated that Andhra Pradesh should have been continued to be a harbinger of Information Technology Revolution in the country and play the role model for other states. The Committee desired that the Central Government as well as the State Government should undertake measures for optimum utilization of available resources in the state by encouraging SMEs in the sun rise Small Scale Industries and thus explore avenues for employment generation by promoting labour intensive industries.

Uttar Pradesh

9.409 The Committee felt that Uttar Pradesh, like Bihar, has been bereft of actual industrialization and therefore the State has more or less become an agriculture state. The Committee, therefore, views that massive efforts should have been made for promoting and proliferating Agro Rural Industries and Food Processing Industries in the State. The Union Ministry of SSI and ARI should have been chalked out strategy for promoting SMEs in these field in the state and accordingly institutional support like opening up of agree export zones and opening up of Agricultural development centres must be provided in the state. Suitable central assistance may be provided for R & D purposes in the field of agro rural industries. 9.410 The Committee was also of the view that adequate attention must be given to improve the working conditions of Handicrafts and Handlooms units in the state and through diversification of products, the profitability of the handloom and handicraft units be enhanced. Suitable strategy should be undertaken for domestic marketing and export of Lucknow's Kurta and pyjama and Chicken print clothes to international market. 9.411 The Committee desired that the Ministry of SSI should have examined the proposal whether under Industrial Infrastructure up-gradation scheme the provision of 25% of the total cost of the project to be borne by the stakeholders of respective cluster may be relaxed and instead the State Government / State Government institution may be allowed to contribute the share of the stake holders. The consent of the State Government in this regard may be sought and accordingly the Committee should be apprised of.

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Maharashtra 9.412 The Committee pointed out that Maharashtra being on the threshold of industrial development, an all out efforts should be made for anciliarization among various segment of industries in order to give fillip to the emergence and consolidation of SMEs in these segment. The Committee also desired that forward and backward linkages should be set up for integrated development of industries in the state. The Committee recommended that the proposal for establishment of industrial towns and its management by first generation entrepreneurs must be encouraged and propped up. The Committee desired to know the comment of the Ministry of Small Scale Industries on the proposal of the industrial federations on the issue of acceptance by the Central Government the certificate issued by District Industries Centres in regard to rehabilitation of sick units. General Recommendations 9.413 The Committee desired that the Ministry of SSI should undergo the merits of the expectation of SSI Associations and the state Governments and accordingly chalk out course of action to address the same in order to improve and proliferate the status of SSI sector in the select states. The Committee was of the considered view that the main issues concerning the Indian SSI sector pertains to rehabilitation of the existing units by providing assistance at concessional rates, advanced infrastructure of international standards, setting up of Information Technology centres for SSI sector, soft funding for up-gradation and modernization, relaxation from power cuts and taxation and strict anti-dumping regulations. It will help to increase the potentials of these units and enable to retain employment and contribution to the domestic production of the country in future. Therefore, the Committee recommended that the Ministry of SSI should have been undertake certain course of action i.e. Making in depth study and research work regarding the actual status of SSI sector to SWOT analysis; Selection of key areas for massive action; Formulation of district wise development strategy in each state for promotion and proliferation of SSI units; Co-ordination with the state Governments, SSI Associations, Banks and other union Ministries / Departments impressing upon the need for promotion of SSI sector; Strengthening of monitoring mechanism for effective implementation of SSI promotional schemes and programmes in each state

9.414 The Committee further recommended that the allocations might be made in a manner as to promote SSI sector in economically backward regions like Bihar, Jharkhand, West Bengal and Orissa where adequate institutional arrangement may be set up for training and man-power development and encouraging scheme, technology, environmental research and Development. Sufficient fund should be allocated for integrated Infrastructural Development and all out efforts should be made to implement effectively the credit generator Fund schemes, credit linked capital subsidy for Technology up-gradation and the Micro-Finance programmes. The Committee desired that Action Plan; state-wise should have been chalked out for promoting small scale industries by the SIDO and impetus should have been given for marketing assistance and export promotion in and through these regions. It may be noted that SSI Sector could able to achieve the Twelve per cent annual growth rate only when the problems being faced by SSI sector in these economically backward regions was removed and when these regions want contributing in enhancing the growth and development. Then and only then, SSI sector may convert itself into 'Engine of growth' for national economy.

(q) 176th report 9.415 While considering the Clauses the Committee observed that the Bill does not refer to the Tiny sector, which constitutes a large segment of the small-scale sector. The Committee therefore recommended that the an appropriate Clause may be incorporated in the Bill to define the Tiny Sector and the Tiny Sector should have been mentioned in the relevant clauses of the Bill. The Committee accordingly agreed to include the Tiny Sector before adopting the relevant clauses of the Bill. 9.416 Clause 2 seeks to define the various expressions used in the Bill. In order to expedite the payment to the small suppliers so that they could settle their dues with Banks, the Committee recommended to reduce the period in Clauses 2 (b), 2 (b)(i) (b) and 2 (b) (ii) to fifteen days instead of existing thirty days. In Clause 2 (g) and 2 (l) the Committee recommended that the term industrial may be replaced with “ enterprises” to include both manufacturing and service units in small and medium enterprises sector. In Clause 2 (m) the Committee recommended inclusion of Tiny enterprises to avail the benefits of the provisions the Bill against delayed payment by the buyers. In addition to exiting categories of suppliers as indicated in Clause 2 (m) the

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Committee recommended the inclusion of other commissions, companies, cooperative societies, society or trusts or other similar entities registered as such under the relevant Act and engaged in selling of goods or services produced or rendered by tiny or small enterprises. The Committee recommended inclusion of the definition of Tiny Sector in this Clause. 9.417 Clause 3 seeks to provide for the establishment of the National Small and Medium Enterprisess Board with its head office in Delhi. If further lays down that the Minister in charge of the Ministry or Department of the Central Government having administrative control of the small and medium enterprisess shall be the ex-office Chairperson. In addition, it lays down the composition of the Board consisting of the Vice-Chairperson, member-Secretary, and 27 members representing various stakeholders. This clause, inter alia, also contains provisions regarding the term of office of the members of the Board, the manner of filling vacancies, frequency of meetings of the Board, association of other persons with the Board and invitation to Ministers of the State Governments to attend its meetings. To facilitate wider representation of States particularly the North Eastern States on the Board, Committee recommended expansion of category of the Minister of State governments under Clause 3 (3) (c ) from five to Six. Also in order to give Board the benefit of parliamentary input, the Committee recommended inclusion of the Chairman of the Department related Parliamentary Committee dealing with Small and medium enterprises. To ensure greater representation of the industry associations in the Board, the Committee recommended expansion of membership under Clause 3(l) from ten to twenty with adequate representation of Tiny enterprises. The Committee further recommended that the Central Government should have been while nominating the members under Clauses 3 (3)(c ) and 3 (3)(l) should have been ensured widest possible representation from maximum States. In order to give Board the benefit of expertise on technological issues which was vital for the development of SME, the Committee further recommended to increase membership under Clause 3 (3) (m) from present two to three to include eminent experts from the field of science and technology. However the Committee underlines that such experts should have been truly independent of government. To facilitate consultation with wider spectrum of stake holders in the Board the Committee recommended that the present limit of ‘not more than two meetings’ for inviting non-members to the Board should be replaced with ‘at least two’ meetings in Clause 3 (8). 9.418 Clause 7 sought to classify “small enterprisess” and “medium enterprisess”, based on investment in plant and machinery, equipment. It also provides in detail for constitution of an Advisory Committee, its composition, role and matters to be considered by it while communicating its recommendations to the Central Government. It also empowers the Central Government, while classify any class or classes of enterprises as small enterprise or medium enterprise, to vary the criterion of investment and to consider other criteria or standards specified in this clause and include in such classification the micro or tiny enterprises or the village enterprisess, as part of small enterprises. The Committee agreed to define the Tine enterprises as those having an investment in plant and machinery to the tune of Rs. 25 crores for the manufacturing units and Rs. 10 crores for the service units. The Committee also recommended that the Tiny Sector may be accorded preferential treatment in terms of enabling provisions of the Bill. The Committee recommended that the Tiny Sector should have been accordingly defined under Clauses 7 (a) and 7 (b). The Committee further recommended that the tiny, small and medium enterprisess should be adequately represented as individual sectors in the Advisory Committee. Also the representation of States too should have been enhanced. Also there should have been linkage between the National Small and Medium Enterprises Board and the Advisory Committee should examine the matters referred to it by the Board. Advisory should also act as the resource agency for the Central government on the issues pertaining to healthy development of the Tiny and SME sector. Regarding Clause 5 (b) the Committee was of the considered opinion that as the tiny, small and medium industries were being defined in accordance with a standard parameters of investments in plant and machinery, to include other parameters could be superfluous. The Committee recommended deletion of ‘ land and building’ in the Clause. 9.419 Clause 8 sought to lay down the requirement for filing of memorandum of small enterprise or medium enterprise with the authority specified by the State Government or the Central Government under the provisions of this Clause. It also empowers the Central Government, to notify, the procedure of filing of the memorandum and the authority with which the memorandum shall be filed by a medium enterprise. This clause also confers powers on the State Government to notify the authority with which a small enterprise may file the memorandum. It also enables the Central Government to notify the procedure to be followed by the above-mentioned authorities for the purposes of this clause. The Committee feels that in order to have clearer scenario in the tiny and SME sector in the country, it was necessary that such units must be registered. It will enable the Government to discern the trends in the Sector and take appropriate policy initiatives. The Committee therefore recommended to make filing of Memorandum mandatory for the tiny, small and medium enterprises. It will enable the units to avail the benefits of Government’s schemes. The Committee however,

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emphasizes that the filing of Memorandum should have been simple and after a given period if no objection was raised by the relevant authority, the unit should be deemed as registered. Such Memorandum may be filed with in one hundred and eighty days from the commencement of this Act. The Committee accordingly recommended that the filing of Memorandum within One hundred and eighty days of the commencement of this Act be made mandatory for tiny, small and medium enterprisess in Clause 8 (1). 9.420 Clause 9 sought to enable the Central Government to notify programmes, guidelines or instructions for facilitating the promotion and development and enhancing the competitiveness of small enterprises and medium enterprises. It also empowers a State Government to provide, by notification, that the provisions of the Employers’ Liability Act, 1938, the Weekly Holidays Act, 1942, the Employment Exchanges (Compulsory Notification of Vacancies) Act, 1959 and the Apprentices Act, 1961 shall not apply to small and medium enterprises employing up to fifty employees in that State. The Committee recommended that as the Clause 9 (1) provides for the measures for the promotion and development of small and medium sector, the Clause should have been also specifically include the tine sector under the coverage of such measures. Further, the Committee was of the view that there was a need for positive discrimination for the women entrepreneurs in tiny and SME sector. Therefore the Clause 9(1) should have been have specific mention of women enterprises to underscore the need for special incentives for women entrepreneurs. Also the competitiveness of SME sector was severely constrained by the outdated, inefficient technologies. Upgraded technologies were an imperative for these enterprises to withstand the competition. Therefore the Committee recommended that technology as a vital input must be reflected in Clause 9 (1) for the promotional measures. The Committee was also of the view that the growth of tiny and SME sector was stunted by the insufficient infrastructural support and availability of critical inputs at reasonable prices. Therefore there should have been specific mention of such measures to overcome these constraints in the Bill. Accordingly the Committee recommended that Clause 9 should have been provided for the railways to earmark a definite percentage of its freight capacity for the transportation of raw material meant for tiny and SME sector as well as for the transportation of the products of such units. Similar mention may be made in the Clause 9 seeking the steel manufacturers and coal producers to reserve definite percentage of their production for the tiny and SME sector. 9.421 Clause 10 sought to provide for the credit facilities to the small and medium enterprisess as may be specified in the guidelines or instructions issued by the Reserve Bank of India. The Committee was of the view that such policies have existed for several years without much of avail. The Committee also took congnisance of the views expressed by the State governments and industry associations on the inadequacy of bank credit at confessional rates to the tiny and SME sector despite repeated RBI guidelines in this regard. While appreciating that the Clause 10 of the Bill recognizes the need to clear such bottlenecks, the Committee recommended to give greater force of law to the provisions of this Clause. The Committee accordingly suggests that term ‘ credit facilities’ may be replaced with the phrase ‘ The policies and practices in respect of credit to the tiny-----’

9.422 Clause 11 sought to empower the Central Government or the State Government to notify preference policies in respect of procurement of goods and services, produced and provided by small enterprises, by its Ministries, departments or its aided institutions and public sector enterprises. Committee recommended that Tiny sector may be included in the Clause 11. 9.423 Clause 14 sought to empower the Central Government to administer the Fund or Funds in such manner, and also entrusts that government with the responsibility for the coordination and ensuring timely utilization and release of sums with such criteria, as may be prescribed.To facilitate that such Funds were utilized by the tiny and SME units from all over the country, it was necessary that States too should establish similar funds with matching contribution by Center and State governments. The Committee suggested that such provision should be made while formulating Rules for this Clause under this Act. Furthermore the States should use these funds to finance R&D for the SME and Tiny sector. 9.424 Clause 15 sought to provide that notwithstanding anything in relation to inspection contained in the Payment of Wages Act, 1936, the Employees’ State Insurance Act, 1948, the Factories Act, 1948, the Employee’s Provident Fund and miscellaneous Provision Act, 1952, the Maternity benefit Act, 1961, the Payment of Bonus Act, 1965 and the Payment of Gratuity Act, 1972, the Inspection of a small and medium enterprisess shall be carried out in such manner, with regard to the promotion of self-regulation or self-certification by the small and the medium enterprises, and by such authority, as may be prescribed. 9.425 Clause 16 sought to provide that every small and medium enterprise responsible for maintenance or such records, filing of such returns with such authority and in such forms, as may be prescribed. Subject to inclusion of Tiny sector at appropriate places in the Clause, the Committee adopted Clause 16.

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(r) 177th report on the Khadi And Village Industries Commission (Amendment) Bill, 2005 9.426 After examining the provisions of the Khadi And Village Industries Commission (Amendment) Bill, 2005 and the consideration of suggestions thereto by the individual experts and organizations/institutions and their implications on the over- all working of the Principal Act, the Committee took up the Clause-by-Clause consideration of the provisions of the Khadi and Village Industries Commission (Amendment) Bill, 2005.

9.427 Clause-2 proposes Amendment in Section-2 of the Principal Act which deals with the definition of the Village Industries. Under the proposed amendment in Sub-Clause-(i) of Clause-(h) the Village Industry could be defined as any Industries located in a rural area which produces any goods or renders any service with or without the use of poser and in which the fixed capital investment per head of an artisan or a worker does not exceed one lakh rupees. The Committee was in agreement with the proposed Amendment in Sub-Clause-(i) of Clause-(h) of in the Section-2 of the Principal Act for enhancing the limit of the Village Industry for fixed capital investment per head of an artisan or a worker in general. The Committee wonders as how the Village Industries continued to be defined with the fixed capital of fifteen thousand which was a too meager amount for establishing even the Village Industries. This Amendment must have come much earlier. The Committee, however, feels that there should be differential criteria for defining the Village Industries for the plain area and the hilly areas so far as the limit of the fixed capital investment per head of an artisan or a worker was concerned. That was so because the cost of establishment of Industry in the hilly areas was higher in comparison to the plain areas. Therefore, the Committee recommended that the proposed KVIC (Amendment) Bill, 2005 must include provision for the limit of the fixed capital investment per head of an artisan or a worker to the tune of rupees one lakh fifty thousand for hilly areas. The Committee takes note of the suggestion made by several stakeholders that the definition of “rural areas” as given in Section 2 (ff) of the Principal Act needs to be revised in view of growing population. The Committee was also of the view that the definition of “rural areas” may be revised. The Committee accordingly suggests that “rural areas” may now be defined as “the area comprised in any village, and includes the area comprised in any town, the population of which does not exceed twenty thousand or such other figure as the Central Government may specify from time to time.” The Committee, therefore, recommended that Section 2 (ff) of the Principal Act may accordingly be amended.

9.428 Clause – 3 the Clause relates to the insertion of new clause (1A) after (a) Sub-Section (1) in section 4 of the Principal Act. The Section 4 of the Principal Act stipulates KVIC as body corporate having perpetual succession with power to acquire hold and dispose of property and to contract with KVIC assuming the juristic personality. The proposed amendment through insertion of new Clause (1A) after (a) after Sub-Section (1) in Section 4 of the Principal Act stipulates that the exercise of all powers and discharge of all functions under this Act, including general superintendence, direction and management of day-to-day affairs of the Commission, shall vest in the Commission. The Committee agreed with the intention of the proposed KVIC (Amendment) Bill, 2005 to envisage KVIC corporate body with the team of experts in various segments of the Khadi and Village Industries. The purpose of the proposed amendment was to acquire professionalism in approach with functional autonomy. The Committee was of the view that the proposed amendment investing in the Commission the exercise of all the powers and discharge all the functions including general superintendence, direction and the management of day-to-day affairs of the Commission may cause apprehension of delay in the decision-making process. Necessary precautions were required to be taken by the Government to remove such apprehension.

9.429 The Sub-Clause (b) (i) proposed Amendment in Clause (a) of Sub-Section (2) of the Principal Act by substituting the words “having specialized knowledge and experience of Khadi and village Industries”, with the words , “having specialized knowledge and experience of Khadi or Village Industries”. In regard to the qualification of Members the Act provided that Members to be appointed by the Central Government as member of the Commission, one must have specialized knowledge and experience of Khadi and Village Industries. Therefore, it was appropriate to amend that section as “ having specialized knowledge and not less than ten years of experience of Khadi or Village Industries” in the Sub-Clause (b) of clause-3 of the KVIC (Amendment) Bill, 2005.The Sub-Clause (b) (ii) of Clause-3 of the KVIC (Amendment) Bill, 2005 Seeks to appointment of three non-officials Members in the Commission having expert knowledge and experience in one or more of the disciplines, namely, Science and Technology, Marketing, Economics or Planning or Rural Development or Technical Education and Training. The Committee suggests that there was a need that there should be separate appointment of Members from each i.e. Economics and Planning, Rural Development; and Technical Education and Training. Accordingly, the Committee recommended Sub-Clause (b)(ii)(b) should provide for five non-official Members instead of three as proposed in the Bill and the Clause may be suitably amended. The Sub-Clause (b) (iii) of Clause-3 further seeks the nomination of and officers not below the rank of Deputy Managing Director as may be nominated by the Chairman of the State Bank of India to be the ex-officio member of the Commission. The Sub-Clause (b) (iv) of Clause-3 makes chief executive officer and

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one Financial Adviser as ex-officio Members of the Commission. The Committee suggests that in the Clause 3 (b) (iv) (d) of the Bill, the word, “one”, may be substituted with the word “a”. The Sub-Clause (b) (v) of Clause-3 proposes omission of the provision made after Clause (d) of Sub-Section (2) of the Section 4 of the Principal Act, which could amount to the effect that the ex-officio member shall have the right to vote in any of the matters discussed at a meeting of the commission.

9.430 CLAUSE – 6 the Clause proposed amendment of Section-10 of the Principal Act which relates to constitution of the Khadi and Village Industries Board, which shall meet at least twice in a year at such times and places and observe such rules of procedure in regard to the transaction of business at its meetings including the quorum at the meeting. The Committee was of the view that in order to avoid the confusion between the State KVI Boards and the Khadi and Village Industries Board, under the KVIC Act, 1956 the latter may be termed as “National Khadi and Village Industries Board”. The Section 10(1) may be suitably amended.

9.431 CLAUSE – 8 the Clause proposed for formation of Zonal Committee’s for each of the six geographical zones. The Zonal Committee shall consists of the the non-official member representing the zone (as Chairman of the respective) Zonal committee, Chairman of each of the State Khadi and Village Industries Boards of the States as the zone-member, Zonal Deputy Chief Executive Officer of the Commission (as convener of the Zonal committee-member), State Directors in charge of the Commission’s Directorates for the States and a Zonal or Regional manager of one of the lead banks operating in the zone-member. The Zonal Committee will observe such rules of procedure in regard to the transaction of business at its meetings (including the quorum at the meetings) as per regulations made by the Commission. The Committee shall meet at least once in every three months. The Zonal Committee shall function as a forum for consultation and act as a conduit for the dissemination of information relating to the programmes and schemes of the Commission for the development of Khadi and Village Industries in the zone; monitor, from time to time, the implementation of the programmes and schemes and provide feedback to the Commission on the problems and difficulties envisaged and suggestions made by banks, voluntary agencies, artisans and others engaged in the operation of programmes and schemes . The Committee welcomed the formation of Zonal Committees and the measures towards decentralized functioning of KVIC, however, with a view to ensuring participation of the real stakeholders, at least one representative of institutions having not less than ten years of experience with khadi and/or village industries with good track record of performance from each one of the States in the zones should have been made members of the Zonal Committee. The Committee understood that the voluntary institutions/co-operatives implement the programmes of the KVIC, therefore, their direct involvement in the Zonal Committee could enable them to realize the correct field position/ correct feed back from the field and thus could be helpful in decision making – process . The Committee received the suggestion that in many States the Chairman of the State Khadi and Village Industries Boards of the States was politically appointee with Ministerial rank and it may not be feasible for him to attend the meeting of the Zonal Committee. Accordingly, the Central Government may decide the representative of the State KVIBs as member of the Zonal Committee in consultation with the State Governments. The Committee also agreed with the view point and therefore recommended that in place of the Chairman, State KVIB, the representative of each of the State Khadi and Village Industries Boards of the States or the Government of each of States in the zone, as the case may be, to be notified by the Central Government within 30 days in consultation with State Government concerned –member.

9.432 The Committee impresses upon the Government to give due consideration to General Observations and Recommendations of the Committee. The Committee was of the view that the process of liberalization and globalization in the Indian economy started since 1991 when the structural-adjustment gave fillip to the concept of corporatisation when the Companies in the private sector and PSUs in the Government sector address the problem of management through having a body of professional management. The Committee wonders as to why the Government took almost 15 Years to adopt the concept in regard to functioning of the Khadi and Village Industries Commission. The delay caused in adopting the KVIC to the fast- changing economic and corporate environment crippled the growth and development of Khadi and Village Industries in the Country and KVIC remained a mute spectator. The Committee has been given to understand that the KVIC (Amendment) Bill, 2005 was a step towards corporatist ion of the Commission. But the real question arises to what extent ? Was not the proposed amendment was a half –way effort towards professionalisation of the Commission. How much time the Government could take for converting the Commission into corporation. The Government may take the plea that the Commission was dependent upon budgetary support to provide subsidy to the Khadi Industries. But how long the Government could be in position to provide subsidy to the Khadi was a big question, which requires the immediate and in-depth attention of the Government. The Committee, while giving due respect to the Khadi as national symbol during India’s struggle for Independence and the importance being attached to Khadi by Father of the Nation, was of the view that sooner the Khadi Industries become economically self-reliant, the better couldbe for its future

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business in the competitive environment and also for the Government which was withdrawing itself from the business course.

9.433 The Committee understands that the main objectives of the proposed KVIC (Amendment) Bill, 2005 was to set into place the professional team in the KVIC. The Committee was, however, of the view that aiming at achieving the professional standard in the working system through appointment of experts at top level was merely “ a window dressing”. The Committee during the course of interactions with the various stake-holders including the representatives of State Government received significant suggestions that total overhauling of Khadi and Village Industries Commission was required to inject a new lease of life into the organizational structure to unleash operational efficiency and functional efficacy in the over all working system of the Khadi and Village Industries Sector. The Committee was surprised to observe that no provision has been made in the KVIC (Amendment) Bill, 2005 for achieving professionalism in the middle and lower level of management in the KVIC. The Committee was of the considered view that in order to attain organizational efficiency and professional proficiency KVIC (Amendment) Bill, 2005 must have the provision for ushering professionalism in all ranks and files of the overall umbrella under KVIC. The Committee was surprised to find that functions of Khadi and Village Industries Board has not been specified either in the Principal Act or in its Rules except with the provision that it could assist the KVIC. The Committee was unable to understand what sort of assistance KVI Board to the Commission was imparting in the absence of clear provisions in the Principal Act. Nor do the rules framed under the Act elaborate on this aspect. The Committee desired that the functions of the KVI Board should be clearly spelt out at least in the rules. In order to make the recovery proceedings effective, the officers of the KVIC at State level should be conferred with the power of Revenue Recovery on the analogy of a similar empowerment of two Central Government Corporations like ESI and EPF. The Village Industries Programme also need identification of marketable products to undertake manufacturing of the same, utilizing local raw material and workmen in its area-wise quality control common facilitation unit set up and run under supervision and monitoring of technical and trained persons for supply of the indented items in given / contracted time. The successful marketing of Khadi and Village Industries Products in both i.e. domestic and foreign markets could only be the real success key for revamping of Khadi and Village Industries Programme in the interest of the poor rural beneficiaries. One of the important factors envisaged for revamping of Khadi and Village Industries Programmes were to create awareness, readiness and acceptability of the same by the targeted beneficiaries. There was a pressing need for special measures in this respect. One such suitable method in the Committee’s opinion was to set up multi-disciplinary training center at every State/district level to educate and train the local youth. 9.434 The Committee received the suggestion that in order to usher National Khadi Revolution, the Government should have made it compulsory for the Government officials in various departments to wear khadi. However, the Committee feels that the State should have been not impose limitations/restrictions ‘on fashion’ and people of free India should have been allowed the ‘freedom of choice’ so far as the fashion was concerned. The Committee was of the view that if the khadi industries were to grow, it has to grow on its own because of the ongoing liberlisation process and the prevalence of open and competitive market. However, the Khadi Institutions under the direction of the KVIC should have been made khadi more attractive to the consumer. The Committee understands that it was through consensus, persuasion and appeals and not through coercion, restriction and regulation, the Khadi revolution has to be ushered in the country. The Committee has been given to understand that the proposed (Amendment) Bill, 2005 couldn’t alter the Working Equilibrium of KVIC because the suggested modifications will not adversely change the basic objectives, powers and function of the KVIC as provided in existing Principal Act. However, the Committee feels that the provisions of the KVIC (Amendment) Bill, 2005 based on the accepted recommendations of the Expert Committee should have been not get the same fate as the recommendations made in the High Powered Committee and the Aurther Anderson Commission. VII. Secretariat 9.435 The Committee on Industry Branch headed by a Committee Officer constituted the Secretariat of the Committee. An Additional Secretary, Deputy Secretary and Under Secretary remained in charge of the Branch. 9.436 To assist the Committee in its work, the material received from the Ministries/Departments/various non-official organisations and individuals was studied from which points were called out and questionnaires for written replies/evidence prepared for the use of the Committee. The Secretariat collected material from on-the-spot studies and prepared study reports.

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9.437 The work relating to drafting, consideration and approval of draft reports by the Committee along with their presentation, laying, printing and distribution was undertaken. The Secretariat dealt with the work relating to the scrutiny of action taken notes received from the Ministries concerned on the recommendations contained in the Reports of the Committee and preparation of Draft Reports of the Committee on the Action Reports. 9.438 The Secretariat also studied material like Parliamentary Debates, answers to Parliamentary Questions, Budget Estimates, Five Year Plan Documents, Books, Journals, Newspapers etc. relevant to the subjects under examination of the Committee.

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Annexure –IX (See Para IV.A)

9.439 Details of the sittings Of the Committee on Industry During The Year 2005

S.No. Date of meeting Duration Hrs - Mts

AGENDA

1. 10.1.2005 1- 20 Meeting with the CMDs of Nationalised Banks, SIDBI and representatives of RBI on the issue of financing of SSIs and Agro Rural Industries (Including large, small and tiny industries). Meeting with the Chairman, Railway Board on support to SSIs and Rural Industries (including large, small and tiny industries) by railways.

2. 11.1.2005 1- 30 Meeting with the Secretary, Ministry of Coal on Supply of Coal to SSIs and Rural Industries (Including Large, Small and tiny industries).

3. 28.1.2005 1 - 15 Presentation by Railways on their role in SSI and ARI Sector. 4. 15.2.2005 1 - 30 Presentation by Ministry of Small Scale Industries on

Promotion of Small, Medium and Tiny Industries. 5. 16.2.2005 1- 05 Presentation by the Secretary, Department of Heavy

Industries on the issue of Technology Transfer. 6. 2.3.2005 1- 40 Presentation by Secretary, Ministry of Small Scale Industries

on the overall Performance of SSI Sector. 7. 3.3.2005 1- 15 Presentation by the Banking Division (Ministry of Finance)

on their role in promotion of SSI and ARI Sector. 8. 16.3.2005 1- 20 Presentation by the Ministry of SSI on their role in promotion

of SSI and ARI sector.

9. 17.3.2005 1- 05 Presentation by NHPC on the issue of Professionalisation of Board of Directors.

10. 28.3.2005 2- 15 Presentation by the various Associations viz. CII, FICCI, ASSOCHAM, PHD Chamber of Commerce and Industry, FWASME, Indian Wind Turbine Manufacturers Association (ITWMA), Indian Plasticizers Manufacturers Association, Laghu Udyog Bharti etc. pertaining to Ministries of SSI, ARI and Heavy Industries and Public Enterprisess.

11. 29.3.2005 2- 15 Presentation by SIAM, ACMA, ARAI on budgetary provisions relating to Heavy Industries. Presentation by the CMDs of select PSUs, (TCIL, BHEL, Praga Tools, REIL, HEC, BYNL) on performance/revival.

1- 25 Presentation by Secretary, Ministry of Heavy Industries and Public Enterprisess on the Demands for Grants (2005-06) of the Department of Heavy Industry.

1- 35 Presentation by the Secretary, Ministry of SSI on the Demands for Grants (2005-06)

12. 30.3.2005

1- 10 Presentation by the Secretary, Ministry of ARI on the Demands for Grants (2005-06)

13. 12.4.2005 1- 30 Meeting with the Revenue Secretary and Chairman, CBSC to discuss tax proposals in the Union Budget (2005-06) affecting the industries.

14. 21.4.2005 1 - 10 Consideration and adoption of Draft Report (of the Committee) on Tax Proposals affecting the industries.

15.

27.4.2005

2- 25

Issues related to direct taxes and VAT in the Union Budget (2005-06) affecting the industries.

16. 3.5.2005 1- 00 Consideration and adoption of Draft Reports of the Committee.

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2- 10 Meeting with the Chief Secretary, Government of Punjab and CMD of Punjab National Bank on the issue of status of Small and Medium Enterprisess in the State; and

17. 9.5.2005

1- 00 Consideration and adoption of Draft Reports of the Committee.

18. 11.5.2005 2- 15 Meeting with the Chief Secretary, Government of Punjab and CMD of Punjab National Bank on the issue of status of Small and Medium Enterprisess in the State.

19. 27.5.2005 1- 50 To consider 'the Status of SSIs in the Textile Sector including the Handloom, Powerloom and Weavers' and hear the representatives of the Ministries of Textile, Small Scale Industries and Finance (Banking Division), lead Banks, the SSI associations in Textile sector.

20. 9.6.2005 2- 35 Meeting with the Chief Secretaries of Government of Uttar Pradesh, Uttranchal, Andhra Pradesh, Jammu and Kashmir, Punjab, Haryana and Himachal Pradesh along with the representatives of Associations/Federations of industries in these States.

21. 21.6.2005 2- 20 to consider the Small and Medium Enterprisess Development Bill, 2005 referred to the Committee for examination. The Committee also heard the Secretary, Ministry of Small Scale Industries on the provisions of the Bill.

1- 20 To hear the Secretary, Minwastries of SSI & ARI on the provwasions of Small and Medium Enterprisess Bill, 2005.

1- 20 To hear the Federations/Associations on Small and Medium Enterprisess Development Bill, 2005.

22. 30.6.2005

1- 25 To hear the representatives of Government of Uttar Pradesh, Bihar, Karnataka, Uttranchal, Andhra Pradesh, Jammu & Kashmir, Punjab, Haryana and Himachal Pradesh on the issue of shifting of industries from one state to other state.

23.

1.7.2005 1- 45 To hear the Secretary, Ministry of Steel on the issue of problems being faced by SSIs in procurement of steel.

24. 22.7.2005 2- 20 to discuss the Small and Medium Enterprisess Development Bill, 2005 with the representatives of the State Government and SSI Associations on the States of Jammu & Kashmir, Himachal Pradesh, Uttar Pradesh, Punjab, Haryana, Rajasthan and Uttranchal.

25. 25.7.2005 2- 10 To hear the Secretary, Department of Commerce on the issue of export potential of SSI and the Small and Medium Enterprisess Development Bill, 2005.

26. 27.7.2005 2- 25 to discuss the Small and Medium Enterprisess Development Bill, 2005 with the representatives of the State Government and the SSI Associations of the respective States.

27. 28.7.2005 2- 30 Discussion on SMED Bill, 2005 with the representatives of State Governments of East Zone and North-East, Ministry of Finance (Banking Division) and the SSI Associations of the respective States.

28. 29.7.2005 2- 20 Clause by clause consideration of SMED Bill, 2005. 29. 2.8.2005 1- 05 to consider and adoption the Draft 176th Report of the

Committee on the SME Development Bill, 2005. 30. 16.8.2005 1- 25

to discuss the progress made by Nationalised Banks during the Financial Year 2004-05 on the issue of Credit Flow to SSI and other related matters.

31. 9.9.2005 1- 25 to interact with the representatives of Railway Board and Ministry of SSI on the issue of provision of Railway wagons for SME sector for transportation of raw material and finished goods.

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32. 19.9.2005 1- 30 to hear the representatives of Ministry of SSI on the issue of supply of steel to SME sector and Ministry of Agro & Rural Industry on KVIC (Amendment)Bill, 2005.

33. 28.9.2005 2- 20 to hear the representatives of Ministry of SSI and Ministry of Urban Development on the issue of status of micro and small enterprisess located in urban slums and problems faced by them.

34. 07.10.2005 2- 10 To interact with the representatives of Banks of Western Zone on the Credit flow to the tiny and small medium enterprisess Sector.

35. 18.10.2005 2- 15 To hear the representatives of Hindustan Cables Ltd., HMT (Bearing), Praga Tools Ltd. And M/o HI & PE.

2- 10 To hear the representatives of the State Govts. Of Punjab, Haryana, Himanchal Pradesh, Uttaranchal, Uttar Pradesh, Delhi and Rajasthan on KVIC Bill-2005.

36. 27.10.2005

1- 30 To hear the representatives of the Department of heavy industries and Auto manufacturing companies on the trends and Prospects in the Auto sector.

2- 15 To interact with the representatives of state Govts. of Mizoram, Jharkhand, Madhya Pradesh, Andhra Pradesh, Kerala and Gujrat along with representatives of NGOs and self- help groups on KVIC Bill-2005.

37. 07.11.2005

2- 05 To interact with the representatives of Department of heavy industries and the representatives of present states on the issue of support of CPSEs (under the Department of Heavy Industries ) to the Small Scale Ancillaries in the select states.

38. 30.11.2005 1- 25 To interact with the representatives of Hindustan Photo Films Manufacturer Company LTD and DHI on the status of HPF Ltd.

39. 08.12.2005 2- 15

KVIC (Amendment) Bill 2005.

40. 09.12.2005 2- 30 Clause-by clause consideration of the KVIC Bill-2005. 1- 20 Consideration and adoption of the report on the KVIC Bill-

2005 1- 30 Meetings with representatives of M/o Urban Development on

the issue of growth and development of micro units located in urban slum

41. 12.12.2005

1- 25 Meetings with representatives of M/o Power on the issue of supply of power to Small Scale and Agro and Rural Industrial Unit.

42. 21.12.2005 2- 00 To interact with the representatives of the Private and Multinational Banks and M/o SSI & ARI and Banking Division on the issue of “ Credit flow to Small Scale and Agro-Rural Industries.

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Annexure –X (See Para IV.B)

9.440 Details of the sittings Of the Sub- Committee on Industry During The Year 2005

Sl. No.

Sub- Committees Date of meeting

Duration Hrs Mts

Main Agenda

1. Sub-Committee-I 05.04.2005 1- 10 Introductory meeting and overview of ARI Sector.

Sub-Committee-I 05.05.2005 1- 10 to consider and adopt the Committee's draft 172nd Report on "Requirement of Coir Industry for its Promotion and Proliferation."

2. Sub-Committee-II 19.3.2005 2 - 05 to hear the representatives of select Public Sector Banks on the issue of financial support to Small and Medium Enterprises Sector.

3. Sub-Committee-III 16.3.2005 2 - 10 to hear the representatives of Hindustan Photo Film Corporation Limited and Department of Heavy Industry on the status and performance of Hindustan Photo Film Corporation Ltd.

4. Sub-Committee-IV 3.5.2005 1- 00 Consideration and adoption of Draft Reports of the Committee.

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CHAPTER-X

COMMITTEE ON SCIENCE & TECHNOLOGY, ENVIRONMENT` & FORESTS

I. Composition of the Committee

10 The Parliamentary Standing Committee on Science & Technology, Environment and Forests was reconstituted on 5th August 2005. The total number of Members of the Committee was 31 out of which 10 Members were from Rajya Sabha and 21 Members from Lok Sabha.

10.2 The Committee consisted of the following Members: –

COMMITTEE ON SCIENCE & TECHNOLOGY, ENVIRONMENT & FORESTS (Constituted on 5, August, 2005)

1. Shri P.G. Narayanan –– Chairman

RAJYA SABHA

2. Dr.Prabha Thakur

3. Shri Dilip Singh Judev

4. Shri Nand Kishore Yadav

5. Shri Ravula Chandra Sekar Reddy

6. Smt. Kum Kum Rai

7. Shri Birabhadra Singh 8. Vacant 9. Vacant 10. Vacant

LOK SABHA

11. Shri Sukhbir Singh Badal

12. Shri Jasubhai Dhanabhai Barad

13. Dr. Sujan Chakraborty

14. Shri Pankaj Choudhary

15. Shri Mohan S. Delkar

16. Shri Francis Fanthome

17. Shri Anantrao Gudhe

18. Shri Babubhai K. Katara

19. Shri A. Venkatesh Naik

20. Shri Brahmananda Panda

21. Smt. Neeta Pateriya

22. Shri Adhalrao Shivaji Patil

23. Shri Bachi Singh ‘Bachda’ Rawat

24. Shri K.C. Singh “Baba”

Shri Jaswant Singh ceased to be a Member of the Committee w.e.f. 11th August, 2005 consequent upon his resignation from the Committee.

Dr. Chhattrapal Singh Lodha ceased to be a Member of the Committee w.e.f. 23rd December, 2005 consequent upon his expulsion from the Rajya Sabha. Prof. Saif-Ud-Din Soz ceased to be a Member of the Committee w.e.f. 29th January, 2006 on being inducted into the Union Council of Ministers.

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25. Shri Rakesh Singh

26. Shri Kirti Vardhan Singh

27. Dr. Ramlakhan Singh

28. Smt. Jayaben B. Thakkar

29. Shri D. Venugopal

30. Shri Sita Ram Yadav

31. Shri Aruna Kumar Vundavalli

II. Subject selected for examination

10.3 The Committee deliberated on the various aspects of the functioning of the different Ministries/Departments under its purview. The Committee in its meeting held on 6th June, 2005 identified the subjects viz., (i) Drugs & Pharmaceutical Research Programme with particular reference to Herbal Research (ii) Science & Technology Application for Rural Development & Upliftment of weaker sections (iii) National Mangrove Afforestation Programme; and (iv) Remote Sensing Applications for Natural Resources Management, for examination and report.

III. Status of Work Done

(a) Sittings of the Committee

10.4 During the year 2005, the Committee held 19 sittings lasting for 35 Hours 30 minutes. A Statement showing the dates of sittings of the Committee held during the period under Review, the duration of the sittings and the subjects discussed are given in Annexure XI.

(b) Study Visits

10.5 The Committee Undertook on-the-spot study visits to various Institutions/Bodies/Centres falling under the purview of the Ministries / Departments. The following table shows the study visits undertaken in 2005, the places visited and date of visits: ––

Sr.No.

Dates of Visits Place Visited In Connection With (Subjects)

01. 02.

30th January to 6th February, 2005 26th September to 4th October, 2005.

Bhubaneshwar and Kolkata Pune, Goa and Mumbai

To examine the working of the different/institutes/dies/centers etc., falling within the administrative control of the Departments of Atomic Energy; Bio-Technology and Scientific and Industrial Research to acquaint itself with their Functioning and also to analyse problems being faced by them. To meet the Chief Secretary, Govt. of Orissa on the subject matter of eviction and settlement of Tribals in Simlipal Tiger Reserve followed by Visit to Nandankanan Sanctuary & Biological Park and to visit Paradip Port Trust/Oswal Industries for assessing Environmental Pollution. To examine the working of the different institutes/ bodies/centers etc., falling within the administrative control of the Ministries/ Departments of Science and Technology; Department of Scientific & Industrial Research, Biotechnology, Ocean Development and Atomic Energy; to acquaint itself with their functioning and also to analyses problems being faced by them.

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IV. Reports Presented

During 2005, the Committee presented the following reports to the House:-

Sl. No.

Report No. and Date of Presentation / Laying Rajya Sabha Lok Sabha

Subject

01. 132nd 17.03.05 17.03.05

Action Taken by the Ministry of Environment & Forests on the Recommendations contained in the one hundred-eighteenth report of the Department-related Parliamentary Standing Committee on Science & Technology, Environment & Forests on the conservation and Environmental Management Plan for Dal-Nagin Lake Srinagar.

02. 133rd 17.03.05 17.03.05

Action Taken by the Department of Science & Technology on the recommendation contained in the one hundred-twenty fifth report of the Department related Parliamentary Standing Committee on Science & Technology, Environment & Forests on the Demands for Grants (2004-2005) of the Department of Science & Technology.

03. 134th 17.03.05 17.03.05

Action Taken by the Department of Space on the recommendation contained in the one hundred-twenty ninth report of the Department related Parliamentary Standing Committee on Science & Technology, Environment & Forests on the Demands for Grants (2004-2005) of the Department of Space.

04. 135th 17.03.05 17.03.05

Action Taken by the Department of Bio-technology on the recommendation contained in the one hundred-twenty seventh report of the Department related Parliamentary Standing Committee on Science & Technology, Environment & Forests on the Demands for Grants (2004-2005) of the Department of Bio-technology.

05. 136th 17.03.05 17.03.05

Action Taken by the Department of Scientific & Industrial Research on the recommendation contained in the one hundred-twenty sixth report of the Department related Parliamentary Standing Committee on Science & Technology, Environment & Forests on the Demands for Grants (2004-2005) of the Department of Scientific & Industrial Research.

06. 137th 17.03.05 17.03.05

Action Taken by the Department of Atomic Energy on the recommendation contained in the one hundred-thirtieth report of the Department related Parliamentary Standing Committee on Science & Technology, Environment & Forests on the Demands for Grants (2004-2005) of the Department of Atomic Energy.

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07. 138th 17.03.05 17.03.05

Action Taken by the Department of Ocean Development on the recommendation contained in the one hundred-twenty- eighth report of the Department related Parliamentary Standing Committee on Science & Technology, Environment & Forests on the Demands for Grants (2004-2005) of the Department of Ocean Development.

08. 139th 25.04.05 25.04.05

Action taken by the Ministry of Environment & Forests on the recommendations contained in the One hundred thirty-first report of the Department-related Parliamentary Standing Committee on Science & Technology, Environment & Forests on the Demands for Grants (2003-2004) of the Ministry of Environment & Forests

09. 140th 25.04.05 25.04.05

Demands For Grants (2005-2006) of the Department of Science & Technology.

10. 141st 25.04.05 25.04.05

Demands For Grants (2005-2006)of the Department of Bio-technology

11. 142nd 25.04.05 25.04.05

Demands For Grants (2005-2006)of the Department of Scientific & Industrial Research.

12. 143rd 25.04.05 25.04.05

Demands For Grants (2005-2006)of the Department of Ocean Development.

13. 144th 25.04.05 25.04.05

Demands For Grants (2005-2006)of the Department of Space.

14. 145th 25.04.05 25.04.05

Demands For Grants (2005-2006)of the Department of Atomic Energy.

15. 146th 25.04.05 25.04.05

Demands For Grants (2005-2006) of the Ministry of Environment & Forests.

16. 147th 22.12.05 22.12.05

Action Taken by the Department of Ocean Development on the recommendation contained in the one hundred forty- third report of the Department related Parliamentary Standing Committee on Science & Technology, Environment & Forests on the Demands for Grants (2004-2005) of the Department of Ocean Development.

17. 148th 22.12.05 22.12.05

Action Taken by the Department of Atomic Energy on the recommendation contained in the one hundred forty- fifth report of the Department related Parliamentary Standing Committee on Science & Technology, Environment & Forests on the Demands for Grants (2004-2005) of the Department of Atomic Energy.

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18. 149th 22.12.05 22.12.05

Action Taken by the Department of Science & Technology on the recommendation contained in the one hundred- fortieth report of the Department related Parliamentary Standing Committee on Science & Technology, Environment & Forests on the Demands for Grants (2004-2005) of the Department of Science & Technology

19. 150th 22.12.05 22.12.05

Action Taken by the Department of Space on the recommendation contained in the one hundred forty-forth report of the Department related Parliamentary Standing Committee on Science & Technology, Environment & Forests on the Demands for Grants (2004-2005) of the Department of Space.

20. 151st 22.12.05 22.12.05

Action Taken by the Department of Scientific & Industrial Research on the recommendation contained in the one hundred forty-forth report of the Department related Parliamentary Standing Committee on Science & Technology, Environment & Forests on the Demands for Grants (2004-2005) of the Department of Scientific & Industrial Research.

21. 152nd 22.12.05 22.12.05

Action Taken by the Department of Bio-technology on the recommendation contained in the one hundred forty-first report of the Department related Parliamentary Standing Committee on Science & Technology, Environment & Forests on the Demands for Grants (2004-2005) of the Department of Bio-technology.

10.6 Minutes of meetings of the Committee on Science & Technology relating to various Reports were prepared and presented to the House along with the relevant Reports.

V. Summary of recommendations

(a) 140th Report

10.7 It is a well-known fact that exact prediction of earthquake is not possible and the science of earthquake prediction has not reached a mature stage as yet, though seismologists all over the world are working hard in this area. It will be a great service to humanity if the seismologists succeed one day in their efforts and save the humanity from great devastations from time to time. Till then we may try to minimize the effect of this natural catastrophe. This can be ensured by enforcing suitable building laws in the country, especially the areas which are more sensitive seismologically. It has to be ensured that all construction activities are undertaken with due regard to earthquake. As regards the existing structures, the Department may prepare a plan how to protect there from possible earthquake in future. The Committee also felt that the Department needs to carry out its study on earthquake move vigorously in collaboration with other countries as they are equally concerned in this regard.

10.8 The Committee felt that thrust of weather forecasting should be on its accuracy and recommends that the Department should consider enhancing the spatial resolution, range and accuracy of forecasts and advisories by constant improvement in mathematical models with the use of available, reliable and accurate satellite data and techniques.

10.9 Regarding toxicity aspects of nano-particles, the Committee while appreciating the gravity of the statement by the Secretary, DST felt that a suitable mechanism should be put in place to assess the toxicity of particles before the findings of the researches of nanotechnology are transferred to industry for applications for production of consumer products particularly cosmetics. The Committee also advocated that industries using nanoparticle technology for the purpose of production must be issued a guided publication containing the details of safety tests and precautionary measures to be taken by industries before the applications of novel properties of nanoparticles. In view of the increasing research in the field of nanotechnology the Committee felt that DST should develop a model that would predict the toxicity of certain nanoparticles. The Committee as a precautionary measure recommended that release of nanoparticles towards environment be minimized until its adverse effects are suitable understood. A constant review of the

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mechanism should also be made from time to time for ensuring lower exposure levels of manufactured nanoparticles in order to provide proper protection to workers engaged in industries and laboratories. The Committee urged the Department to fix a minimum exposure standard of manufactured particles after thoroughly examining the international regulatory limit in the field so that a properly examined norms of exposure could be finalized from the point of view of possible medical hazards of nanoparticles.

(b) 141st Report

10.10 The Committee understood that although the brain research institute is doing state-of-the-art investigation in the field of various neuro-degenerative disorders and pathological mechanism of various ailments relating to human brain, there are still some important areas left where the institute needs to concentrate for giving brain research a holistic dimension.

10.11 The Committee understood that although the brain research institute is doing state-of-the-art investigation in the field of various neuro-degenerative disorders and pathological mechanism of various ailments relating to human brain, there are still some important areas left where the institute needs to concentrate for giving brain research a holistic dimension.

10.12 In the opinion of the Committee, such areas involve detailed investigations into the causes of the fatally life threatening brain cancers like oligodendro glioma, glioblastomas and other forms of complicated cancerous brain disorders.

10.13 Although the institute is pursuing a research project about the mechanisms of L-BOAA mediated neurotoxicity, the Committee also advocated that research should be initiated by the institute regarding secretion of common brain hormones from substantia nigra and artificial development of L-DOPA to deal with basic mechanisms of neuro toxicity.

10.14 The Committee suggested that researches on endogenous opiates like enkephalin and endorphin should also be initiated for understanding the chemistry of pain for designing a comprehensive pain management strategy in case of certain killer disease like cancer etc.

10.15 The Committee also noticed that no substantial research has been initiated on PRIONS (Proteinaceous Infectious Particles) by the institute, a Stanley Pruisner concept, which is the main cause of BSE (Bovine Spongiform Encephalopathy). The Committee has been given to understand that due to lack of P-2 containment facility available with the institute, no research is being carried on PRIONS and PRIONS related disease. The Committee urged that since such type of disease may take alarming form in future, primary investigation of the causes of such diseases is the need of the hour through development of P-2 and even P-3 containment facility with the institute which at present the institute is lacking.

10.16 The Committee has also understood that problem of Alzheimer, which is a common form of brain disease, particularly at senile age requires more research as it is gradually on the rise among civil population. Latest research reports in the advanced countries show that real culprit in Alzheimer’s ailment is a copper and zinc build-up in the brain. It is believed by the scientists that accumulated metals mix abnormally with a protein called beta amyloid in the brain, oxidizes, literally rust and destroy nerve cells. Amyloid protein plays a helpful role in the brain: absorbing metals like a sponge. But in Alzheimer’s victims, the metals overwhelm the protein. Copper mixes abnormally with amyloid, releasing hydrogen peroxide and other toxic chemicals and damage the nearby cells. Some of that protein breaks free, becomes “rogue” amyloid, and mixes with zinc to form clumps that leak more hydrogen peroxide - metals as the real culprits. The scientists are of the opinion that excess copper and zinc built up in the brain dissolves the protein clumps in the brains, which has already been experimented in animal model. Since the disease may assume alarming proportion in future due to increased stress owing to phenomenal rise in urban conglomerates and modernization, this aspect of the disease requires deep research so that a target drug for controlling the ailment could be designed for future medication. The Committee, therefore, recommends that researches in the following fields needs to be given greater attention by the institute:

i) Cure for Alzheimer’s;

ii) Researches in the field of PRIONS related diseases;

iii) Investigation in the field of pain hormone related issues being secreted from Substantia Nigra by brain like enkephalin and endorphin;

iv) Cure for fatal brain cancers like oligodndrogliomas etc. and

v) Investigation into the causes and cure of Multiple Sclerosis (MS).

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10.17 Regarding Indian Institute of Immunology, the Committee has noted that although this premier research Institute in the field of immunology has not undertaken any work relating to the production of interferons, it has, however, designed an appreciative investigation in the field. The Committee has noticed that interferons have been implicated as signals controlling the way in which the immune system detects and recognises antigenic proteins of viruses, including those viruses associated with certain cancers. The Committee felt that once these findings from the interferons research proves successful, it could be shared with other premier Oncoligical Research Centres in the country.

10.18 The Committee has noted that the Institute has not been conducting any research relating to the treatment of some life threatening autoimmune diseases like Wegener’s Granulomatosis, myasthenia gravis and pemphigus vulgaris. Although the Committee knows that these are rare type of auto-immune diseases among human population, the Committee was, however, apprehensive that they may become severely life threatening in distant future due to rapid increase in stress related syndrome owing to unabated urbanization and modernization.

10.19 Keeping this in view the Committee felt that such type of auto-immune diseases also require deep investigation for establishing their causes and cure through promising research projects so that some concrete answer to these ailments could be designed by medical science before they assume any life threatening proportion. The Committee, therefore, recommends that the Institute should consider primary investigation in the field of the following auto-immune diseases through the production of ‘interferons’ :-

i) Wegener’s Granulomatosis

ii) Myasthenia Gravis

iii) Pemphigus Vulgaris

10.20 The Committee appreciated the contribution of the Centre towards DNA fingerprinting, diagnostics in addition to basic research in related areas. The Committee, however, noted that such Centres of excellence are very few in number and recommends that more such Centres should be set-up in the country in near future.

10.21 The Committee was of the opinion that there is an urgent need to streamline guidelines and procedures for approving genetically engineered pharmaceutical products, as this is a complex process involving multiple ministries and regulators that lack systematic coordination. The Committee therefore strongly recommended that the Department should set up an autonomous body like “National Biotechnology Regulatory Authority” to approve biotechnology products — and dispense with similar tasks being handled by the Genetic Engineering Approval Committee of the Ministry of Environment and Forests. The proposed authority should also incorporate separate divisions in areas like agricultural products and transgenic crops; pharmaceuticals and industrial products; and transgenic food, feed and animal aquaculture.

(c) 142nd Report

10.22 The Committee noted that most of the scholarships/fellowships are provided to students at the higher level i.e. PhD/ Research levels. The Committee recommended that scholarships/fellowships may be provided at the entry level i.e. graduation level and may be increased for students in Post-graduate level to stimulate interest among the new generation towards basic sciences. The Committee also recommended that the number and amount of fellowships/scholarships should be increased over a period of time. The Committee felt that for the development of science there is a need to improve the opportunities for well-trained scientists and young talents to pursue innovative research, to educate the next generation to apply science in areas of importance for the health, prosperity and security of the nation.

10.23 The Committee recommended that a special cell may be set up to coordinate and pool the knowledge gained in the CSIR laboratories and the private sector companies and disseminate it through direct interactions with the industry or through the print and electronic media. Efforts may also be made to ensure that there is no duplication in the research work carried out in the CSIR laboratories and the private sector companies so that country’s scarce resource is not wasted.

10.24 The Committee noted that the research regarding biofuels is still at a research stage and commercial production is yet to begin. However, the initiative taken by the Department to produce biofuel, specially from ‘Jatropa Curcus ‘ plant is commendable in view of the fact that large tracts of wasteland in the country can be utilized and the farmers can benefit a lot from the commercial production of this plant. The Committee, therefore, recommends that efforts should be made towards early commercialization of the technology, which will benefit the farmers as well as the consumers.

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10.25 The Committee, however, has noted that in a few prominent areas where research is necessary to understand the anatomy of earth’s inner core, the Institute has not so far undertaken any scientific investigation which are as follows:

a) Heat generating capacity of Radiogenic isotopes of potassium which may power convection in the core of the earth and drive the magnetic field in the earth’s crusts;

b) The earth’s dynamo action; and

c) Geo-neutrino picture of earth’s interior for its better comprehension.

10.26 The Institute has stated that since geo-neutrino study is not within the purview of NGRI’s research activities, the Institute has not attempted any research work in this field. The Committee, however, saw no reason why such an important study has not been kept within the purview of the research activities of the Institute while in other parts of the world the study of geo-neutrino imaging of earth crusts is being given primary importance. The Committee felt that geo-neutrino imaging can give vital information about earth’s core that may prove to be extremely useful for Institute’s preparation of Seismic Hazard Map on which the Institute has already taken a lead under a global attempt.

10.27 Moreover, some neglected areas like the understanding of the heat generating capacity of Radiogenic Isotopes and greater understanding about earth’s dynamo action may be of considerable help for the Institute to establish a perfect intelligibility of the anatomy of earthquake and its accurate prediction which is still eluding the scientists the world over.

10.28 The Committee, therefore, strongly recommends that feasibility should be explored by the Institute to direct its research activities to the following fields which are hitherto remained neglected:

i) Understanding of earth’s dynamo action;

ii) Geo-neutrino imaging of earth’s interior; and

iii) Understanding of heat generating capacity of Radiogenic Isotopes of potassium for a clear intelligibility of the anatomy of heat flow from core to mantle, driving convection motion in the outer core that could be linked with generation of earthquake.

(d) 143rd Report

10.29 The Committee apprehended that certain branching corals like Acropora Cytherea also known as stag horn corals which are common in Andaman waters might have been affected severely by the Tsunami onslaughts.

10.30 The Committee was, however, of the opinion that unless comprehensive planning is made, neither proper and deep assessment of the health of coral in these areas could be made nor any critical measures could be designed to remedy the health of these corals in the affected areas. The Committee, therefore, understands that in order to have a very successful picture of the entire assessment scenario, the following measures need to be considered by the Department before undertaking major audit of coral health in these areas:

i) Norms of audit through symbiotic studies of coral health will have to bemapped.

ii) New insights into the role of cell suicide and apoptosis in bleaching of corals should also have to be developed.

iii) A detailed mapping of coral stress tolerance is necessary to be assessed and mapped.

iv) The behaviour of coral reef fish is needed to be assessed on a comparative pilot-scale basis in coral areas which are severely affected by Tsunami and areas which are less affected or are not affected at all by the Tsunami onslaught.

v) Since reef bleaching and mortality are highly co-related, the study of coral bleaching in detail is also necessary since this could be linked to global climate change specially elevated sea water temperature and high solar irradiance.

10.31 The Committee felt that successful restoration and management of coral health require a more realistic and historically informed understanding of the ecology of near-pristine condition of coral reefs that can only be obtained by a combination of retrospective analyses, modeling and intensive studies of eco-system structure and function of the very few isolated reefs that have escaped intensive exploitation by Tsunami onslaughts. The Committee has understands that studies based on an index known as DI, i.e., comparative Deterioration Index of community for corals will have to be undertaken for deriving a comparative picture of analysis of the health deterioration of different corals groups in these regions. The DI values can show the

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likelihood of some of the corals getting rehabilitated early and some corals more at a later stage which is proportional to the destructive index of each coral community following the Tsunami onslaughts. The training should be given to surveyors for fast yielding of elaborate data based upon deterioration index of these coral communities so that relatively accurate picture could be framed for the subsequent restoration. Moreover, the DI approach can serve as an efficient tool for Marine Protected Areas (MPAs) Selection and Management. The Marine Protected Areas (MPA) is the primary form of protection in the marine coastal zone and could be used as a spearhead for marine conservation including the restoration of coral health. The MPA could be directly linked with DI index and the coefficient of the DI picture can give details for restoration of the marine protected areas. Apart from this, identification of new Heat Shock Protein (HSP) of marine invertebrates is expected to enable rapid and accurate quantitative monitoring of short term and long-term fluctuations in marine eco-system. The expression of specific stress proteins present in certain coral community can be identified as early warning system for future changes in coral communities following Tsunami disturbances and also the ability of reef eco-system to withstand global changes could also be assessed.

10.32 The Committee further felt that while assessing coral health, the incidence of coral diseases may also be studied because in most cases etiology of greater number of coral diseases are still unclear and the nature of relationship between coral and their associated bacteria are not yet fully established. Since the reef bleaching and mortality of coral are highly co-related, a detailed mapping in this regard is also necessary before designing a proper restoration scheme. A major and topical question concerns the effect of increasing atmospheric CO2 on coral calcification. Coral calcification rates have been used to derive information on carbonates saturation state in the ocean and to derive specific conclusion on atmospheric CO2 levels in the past and in the future.

The Committee in 128th Report regarding polymetallic Nodules Programme Committee recommended on the issue extraction technology PMN and its repercussion on ocean biology as follows:

10.33 Although the Committee was happy with the contents and performance of projects under Poly Metallic Nodules programme of Department, it is, however, sceptical about the Department’s assessment about the preservation of environmental norms for optimal sea ecology at the mining site.

10.34 The Committee was of the opinion that before a comprehensive planning is undertaken for on-site mining of nodule, the Department should prepare an experimental chart about the precise disturbance of the sea floor at the mining area to assess its geological and ecological conditions. The Committee felt that while organisms would be destroyed in the mined area undisturbed areas would remain because of the complex terrain of sea bed which could serve as biological reservoir for recolonizing the destroyed section.

10.35 The Committee was of the opinion that dangers arising from the release of underlying heavy metals when the upper sediment layer is removed, could change or disrupt geochemical systems that has been stabilized over geological time, possibly creating zones of reduced oxygen where life would become impossible.

10.36 The Committee, therefore, felt that before mining is initiated, Department must examine the effect of mining on local animals at the site caused by dragging of plough across the bottom to stimulate the effects of nodule mining on the sea bed, including the rates at which animals of the same species returned to the disturbed area. The study should be done in this respect on mega fauna animals large enough to be seen at the ocean bottom. The Committee was of the opinion that the effects of mining will be greatest on the sea sponges that lived directly on the nodules because their habitat will be completely destroyed. Other free swimming species will suffer a considerable reduction in numbers due to serious disruption in food supply. The Committee, therefore, is of the view that from emerging picture above the evaluation of bio-threat exposed by sea bed mining is indispensable to be addressed thoroughly before venturing into mining operation and the Committee felt that any such evaluation is difficult without better knowledge of the organisms living at the mining site and the eco-system in which they function. It is quite apparent that animals at the site area would be killed by the impact of the mining vehicle and by resettlement of the sediment cloud that impact of the mining vehicle will raise from the sea floor.

10.37 Another potential effect of mining on the ocean floor is the bringing up of unwanted materials during a mining operation i.e. sediments, trace metals from nodule waste and cold and nutrient rich bottom water into the upper ocean. Owing to this problem, the Committee felt that deep or mid ocean level will be most desirable area for discharging of miners waste as it would not be harmful to the environment.

10.38 The Committee further felt that burial sensitivity of sea bed organisms i.e. the consequences of dumping a layer of sediment on top of them as a direct repercussion of mining should be studied thoroughly by

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Department as lesson for Environmental Impact Assessment of sea-bed mining. The Committee felt such studies could be undertaken by the Department through Remotely Operated Vehicle (ROV).

10.39 The Committee, therefore recommends that Department should undertake critical assessment of different mining techniques and their subsequent effects on Geochemistry and Ocean Biology and Department should generate reliable data for determining the optimal mining techniques i.e. ideal extractive metallurgy to minimize environmental impacts.

10.40 The Committee, therefore strongly recommends for constant assessment of environmental impact of deep sea-mining by Department before venturing into actual mining operation keeping the following into consideration for a meaningful assessment of the impact:-

(a) Biodiversity, species ranges and rates of gene flow in the nodule areas;

(b) Burial sensitivity of deep-sea animals and their response to the type of disturbance caused when nodules are scraped from the sea floor, as well as recovery of marine organisms in space and time;

(c) Impact on ocean column by rising unwanted materials from mining operation located above a mine site;

(d) Natural variability in deep ocean ecosystems over space and time;

(e) Access to sea bed data which may be generated by Central Data Repository under the control of Department for accurate assessment of environment for determining the choice of correct mining technique;

(f) Month to month, year to year and place to place changes to be investigated as a further means of understanding the environment in which deep sea mining will operate.

10.41 The Committee also recommended that apart from the mining of Poly metallic Nodules, the Department should also thoroughly assess the potentials of mining Hydrothermal Polymetallic Sulphides and Cobalt-rich ferromanganese crusts from the Ocean bed keeping in view the export potentials of such metals in the international market.

In pursuance of the above recommendation of the Committee in its 128th Report, The Committee in its 143rd report recommended as follows:

10.42 The Committee felt that the country is facing an enormous task of carrying development and meeting the challenges of modern times for which there is a particular requirement of minerals. Therefore, efforts of the Department should be directed towards tapping of rich and economically viable deposits of Poly Metallic Nodules and utilize them for filling gaps in availability of resources. It will help in meeting the requirement of the country for minerals besides attaining self-sufficiency. Moreover, if deep seabed mining technology is perfected, the country can comprehensively increase its capacity in extracting the Poly Metallic Nodules.

10.43 Apart from anti-cancerous drugs like Didemnin-B, Bryostatin-1, Dolastatin 10 etc. which were earlier cited by the Committee, another very important anti-cancerous drugs that could be extracted from sea organism, is Ecteinascidin 743 (ET-743) which is by far the most advanced compound that could be extracted from Tunicate. The drug has already undergone three clinical trials in advanced countries and has proved to be a carrier of potential anti-tumour activity, which is especially effective against solid tumours, such as sarcomas and breast cancer. The Committee, therefore suggests that extract of the ET-743 may be attempted from tunicate by the Department in collaboration with medical community which may open the door for a challenging use of this drug against possible successful cancer treatment in future.

10.44 However, the Committee felt that serious obstacle in the ultimate development of most natural marine products that are undergoing clinical trials or that are in pre-clinical evaluation is the problem of supply. For example, in order to obtain approximately 1g of the promising anit-cancer agent ET-743, a close to 1 metric tonne (net weight) of the tunicate has to be harvested and extracted. In case of other anit-cancer drugs also, the ratio of biomass to yield of product is even less.

10.45 The Committee felt that huge quantum of ocean biology is involved in extracting a very miniscule quantum of drug from the entire group of such organism. It also feels that such large amount of biomass of either sponges, tunicates or other pharmacologically promising marine in-vertebrates can never be harvested from nature without risking extinction of the respective species.

10.46 Isolation and cultivation of suspected microbial producers of bioactive natural products either from the surrounding sea water or from the tissue of invertebrates through careful design of special media could

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provide a much needed answer to the pressing supply problem that is currently presented by many pharmacologically interesting compounds and hampers their further development as a drug. If bacteria are indeed the producers of bio-active metabolites of interest, transfer of gene cluster responsible for the biosynthesis of the respective natural products to a vector suitable for large scale fermentation could perhaps provide an alternative strategy thereby avoiding the foreseeable difficulties in culturing symbiotic bacteria.

10.47 With the advancement of this knowledge the ultimate goal of supplying sufficient quantities of drugs from sea for pharmaceutical development without destroying valuable natural resources may ultimately be reached by the Department if a concentrated effort is made in the field.

10.48 The Committee, therefore, felt that alternative strategies for an environmentally sound and economically feasible supply of marine natural products are needed. The Committee also felt that the obtained yields of bio-mass, however, are still very far from those that will be needed once one of these compounds has finally entered the drug market. The Committee, therefore, is of the opinion that in view of the problems related to the important supply issue, the question arises whether sponges, tunicates, bryozoans and other invertebrates are the true producers of the various bioactive compounds or whether these natural products are of microbial origin. The answer to this question, which is one of the key issues in modern marine natural products research, will have far-flung consequences and open up entirely new approaches for the production of drugs from the sea using biotechnological methods.

10.49 The Committee appreciated the efforts of the Department in the area of desalination of sea water. It understands that some other Departments are also making efforts in this direction. It is, therefore, desirable that all the efforts are coordinated to achieve better and quicker results. The Committee hoped that with integrated and coordinated efforts of the various Departments, the Country, particularly its coastal areas, can think of getting safe drinking water at affordable cost in the near future. This would also help in solving one of the greatest burning problems of the country, which is facing a peculiar situation ‘water, water everywhere, but not a drop to drink’.

10.50 The Committee, therefore, felt that Department of Ocean Development should undertake study at pilot scale while dealing with problems of extraction of gas from hydrates on the following:

a) The behaviour and distribution of the products of natural gas flaring in the atmosphere and their impact on water environment; and

b) The environmental consequences of the offshore drilling accidents is an important anthropogenic source of gas hydrocarbons in the water environment.

10.51 The Committee was also of the opinion that an important anthropogenic source of gas hydrocarbons in the water environment is the offshore drilling accidents. The environmental consequences of offshore drilling accidents can be very hazardous. Such accidents may cause long term release of large amounts of natural gas into the water accompanied by self inflaming of the gas. During such events the levels of methane in surface water can exceed the background concentrations up to about10-100 times. These accidents can drastically disturb the composition and biomass of the water fauna and can cause mass mortality of many organisms including anadromous fishes and benthic mollusks.

10.52 The Committee was been given to understand that Medical toxicology distinguishes between three main types of intoxication by methane on ocean bio-organisms :

Light intoxication, results in reversible, quickly disappearing effects on the functions of central nervous and cardiovascular systems;

Medium intoxication, manifests itself in deeper functional changes in the central nervous and cardiovascular systems and increase in the number of leukocytes in the peripheral blood; and

Heavy intoxication, results in irreversible disturbances of the cerebrum, heart tissues, and alimentary canal as well as acute form of leukocytosis.

10.53 The Committee felt in particular that increasing temperature generally intensifies the toxic effect of practically all substances on fishes because of the direct correlation between the level of fish metabolism and water temperature. This can also be correlated to the general intensification of fish metabolism by the increased permeability of the tissues for the poisons and increased oxygen consumption under high temperatures. It is, therefore, evident that toxicant concentrations can cause severe damages and lethal repercussion with increasing water temperature on sea bio-organisms. The Committee, in view of the above, therefore, recommends that the Department of Ocean Development while dealing with the gas hydrates extraction issue should also deeply concentrate on eco toxicological assessment of the impact of natural gas and other toxicants on the marine organisms. It should be remembered that methane hydrate could become

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crystallized ice during winter and correspondingly dissociate during increased temperature in summer followed by releasing of free methane into the ocean geochemistry with this corresponding environmental consequences as explained above.

10.54 In the opinion of the Committee, another critical environmental factor that directly influences the impact of natural gas on water organism is the concentration of dissolved oxygen. It is quite evident that oxygen deficit directly controls the rate of fish metabolism and decreases their resistance to many organic and inorganic poisons. This may be directly linked with species character. From the physiological perspective, the level of hemoglobin in fish blood and the rate of blood circulation through the gills increase under oxygen deficit condition.

10.55 The Committee was, therefore, of the firm opinion that laboratory studies is also necessary to understand the process by which the gas hydrate by releasing poisonous gases like CO2, Methane, Hydrogen sulphide into sea ecology seriously affects the biometabolism of sea organisms.

10.56 The repercussion of gas leakage on ocean fishes are extremely sensitive. The fish response to a toxic gas leakage is extremely high in comparison to its response to other dissolved or suspended toxicants. The gas could rapidly penetrate into the organism of the fish through the gills and disturb the main functional systems. There is external evidence of its disturbance which changes the behaviour of this aquatic animal like fish excitement etc. The Committee was also been given to understand that the time interval between the moment the fishes come in contact with such toxic gas and the first symptom of poison surfacing on these organisms are relatively extremely short. The entire toxicological effect could be assessed by the nature of the toxicant, its toxicity in water, exposure time and evaluating by environmental degradation. Gas emboli could be the general effect typical to all types of fishes. These include rupture of tissues, enlarging of swim bladder, disturbances of circulatory system and a number of other pathological changes. The Committee therefore, recommended that deep study of water toxicology of saturated aliphatic hydrocarbons of methane should be undertaken by Department of Ocean Development. The Committee further urged for the development of toxicity data on different gaseous poisons, which could reveal some general features of interaction between gaseous traces and marine organisms.

In its 128th Report regarding exploration and research in icy continent of Antarctica, the Committee Recommended the following:

10.57 Exploration of the icy continent is a challenging task before the Department. The Committee felt given the extremity of the prevailing situation in this continent of ice, Department has taken the real pain to embark upon a formidable task of initiating scientific experiments in an extreme cold conditions. Although the Committee was fully convinced about the quality of the research work undertaken till date in this uninhabited and inhospitable mass of ice land, it feels the following areas of research should be given more attention due to their global, social, medical, scientific and economic importance:

a) Studies on evolution of Antarctic Glaciology;

b) Studies on ozone hole issues;

c) Studies in geological and geophysical investigation of the Schirmacher Oasis and Orwin and Wolhthat mountains;

d) Studies about Antarctic microbes specially cynobacteria with special reference to their survivality rate in extreme cold situation so that any new knowledge about the process of biological withstanding of extreme low temperature could be utilized for Indian defence personnel staying in Siachen Glacier;

e) Studies in Antarctic pollution;

f) Studies in Krill biology;

g) Studies in auroral phenomenon;

10.58 The Committee while strongly recommended basic and in depth researches in these fields urges the Department to uphold its commitment to protect the pristine nature of the Continent.

Keeping this in view the Committee in 143rd Report recommended as follows regarding researches and Antarctica

10.59 The Committee recommended that the Department should study the icy continent’s atmospherics and ozone depletion. Besides ongoing activities, it should also plan to undertake studies on lake biology, Antarctic microbes, and relation of the Antarctic plate with the Indian plate, telemedicine, clean energy technology,

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micro and molecular biological studies on low temperature life forms and the impact of human activity on Antarctica. In addition, the Department should also undertake a shallow drilling in Antarctica for retrieval of ice core for paleo-climatological studies. If required, the Department should also take steps to workout collaboration agreements with other countries in this regard.

The Committee again in its 128th report recommended the following regarding the research on sea environment and pollution by the Remotely Operated Vehicle

10.60 The Committee was pleased to note that the Department is mainly using two Ocean Research Vessels, namely Sagar Sampada and Sagar Kanya for deep sea research. These vessels are using remotely operated vehicle (ROV) and Autonomous Underwater vehicle (AUV) to study about deep sea life forms at considerable depth. However, the Committee felt that scope of deep sea research could be more challenging and informative if machineries could dive beyond a depth of 6000 meters. The Committee was therefore of the opinion that for a real deep sea study Advanced Tethered Vehicle (ATV) is needed by Department which is an unmanned vehicle equipped with latest advanced technology and which can easily undertake researches beyond a depth of 6 thousand metres. The most striking advantage for using the ATV for underwater research is that it is extremely helpful to make researches at extreme depth where it is dangerous for divers to venture. The Committee was given to understand that such vehicles are cost affective and can be used in ocean abyss with much flexibility. It is observed that the vast majority of the ocean depths are bone chilling cold, completely dark and have ambient pressures equivalent to the weight of the hundreds of atmospheres. The exploration of the deep sea is, therefore, impossible without a substantial investment on latest technology. The Committee therefore strongly recommended that the Department may use Advanced Tethered Vehicle (ATV) for the purpose of deep sea research in view of its deep sea advantages and cost effective applications. This vehicle will be extremely helpful for researches at ocean benthos where greater variety of biotic and abiotic elements are available and a study of which could add considerably to the store house of human knowledge about ocean depth.

Keeping this in view the Committee again reiterated the following in its 143rd Report regarding Ocean Research Vessels

10.61 The Committee endorsed the uninterrupted operations of the vessels for the Coastal Ocean Monitoring & Prediction System (COMAPS) and Integrated Coastal & Marine Area Management (ICMAM) programmes. The cruises involved by the vessels should be carried on frequent basis to monitor pollution with assistance from national laboratories and other oceanographic observations for universities. These cruises will also help the Department to continue the physical oceanographic observations & microbiological studies for the Waste Load Allocation Project under ICMAM. The cruises should also observe critical habitats in Lakshdweep Islands specially sea turtles.

(e) 144th Report

10.62 The Committee appreciated the efforts of the Departments for taking up the programme of micro-satellite exclusive for HAM radio services as this service has provided generous service to the community in the time of disaster and when other conventional means of communication had failed. The Committee recommended that Department should coordinate with the Department of Science & Technology and Ministry of Human Resource Development for popularizing the use of HAM radios through training and introduction of Ham radio as a extra-curricular activity in schools and colleges .

10.63 The Committee commended the role of the Department in bringing high quality medical care to patients transcending the hindrances posed by distances and other geographical barriers. It believes that this can be a boon for countries like India where the majority of population lives in remote areas without access to even basic health care. The Committee felt that as most of the patients in remote and rural areas are not able to get primary health care and especially in case of women where mortality quite is high during childbirth, the Committee recommended that the Department should strive to percolate the benefit of this programme to such section of society.

10.64 The Committee in its 129th Report on Demands for Grants (2004-05) had suggested for fulfillment of some scientific objectives as research perspective as a part of the Chandrayan-1 Mission. The Committee further recommended that in addition to the existing moon mission objectives of the Department of Space, possibility of extraction of Helium-3 from the Moon soil could also be examined. It is expected to be the cleanest fuel for 21st century fusion reactors because its reaction is efficient and at the same time produces low residual radioactivity. Helium 3 is deposited on the lunar regolith by solar winds. So far as extraction of the Helium 3 from lunar regolith is concerned, which has been stirred by collision with meteorites, Helium 3 is available at several meters depth of the lunar surface. The Committee has been given to understand that the greatest concentration of Helium 3 will be found on the lunar maria. Since it is extremely potent, non-

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polluting, with virtually no radioactive by-products, the Committee felt that Helium 3 is the perfect fuel source for the current century. Moreover, Helium 3 fusion energy may be the key to future space exploration and settlement.

10.65 It is, however, clear from the above that the propulsion system mainly used for the rocket engines by the Department of Space, that is, liquid, solid, auxiliary and cryogenic system, involves the following problems:

The liquid hydrogen being used for cryogenic propellants is highly flammable.

It produces invisible cold flame.

It is liable to produce large volume of explosive gas cloud sensitive to ignition due to high liquid vapour expansion.

Earth Storable Propellants are toxic in nature.

Hydrazine is also difficult to handle and is highly toxic.

Any exposure to human being is extremely dangerous and environmentally fatal.

10.66 The cryogenic propellants, especially liquid hydrogen is highly flammable and produces invisible cold flame. Due to high liquid vapour expansion, it is liable to produce large volume of explosive could which is very sensitive to ignition. The Committee, therefore, feels that before using cryogenic propellants very elaborate safety precaution are required to be taken since some of the earth storable propellants are toxic in nature and their exposure to human population can lead to serious environmental and biological consequences and, therefore, their level of exposure should be made limited and preventive steps should be taken against high level exposure because it has disastrous consequences. The Committee, therefore, feels that adequate safety precaution during storage, handling and servicing of liquid hydrogen, needs to be taken in order to avoid any occupational hazards that may arise in future.

10.67 The Committee was of the opinion that since the findings of the Space Physics Laboratory have a direct bearing over the quantum of environmental pollution due to aerosol eroding in the immediate atmosphere over the biosphere of the earth and also its influential impact over the predictions of the weather pattern and climate pattern in the atmosphere, any conclusion of the findings could be submitted to the IMD under DST for a further study for controlling of air pollution and predicting weather and climate changes in the near future.

10.68 In this connection, the Committee mentioned that although Ammonium Perchlorate (AP) and Storntium Perchlorate (SP) are necessary as oxidizer in solid motors and for injectant for Thrust Vector in control system of Launch Vehicles for rockets, necessary precautionary measures should be taken by Department of Space due to environmental pollution potential of AP & SP before using them as oxidizer and injectant in motors for rockets.

(f) 145th Report

10.69 The Committee found that the pace of expenditure by the Department of Atomic Energy has not been uniform and the reasons attributed are more of administrative nature. The Committee therefore recommended that the Department should formulate strict monitoring mechanism with proper planning and co-ordination of projects/programmes for regular infusion of funds in various projects/schemes in all quarters of the financial year to ensure total utilization of plan allocation and avoid surrender/shortfall of funds in the last quarter of the financial year.

In its 130th Report the Committee observed as follows:

10.70 The Committee has been given to understand that the Universal Extraction, or UNEX, process which is being studied in USA by Idaho National Engineering and Environmental Laboratory (INEEL) engineers which is a subsidiary of US Department of Energy has developed the first demonstrated technology of its kind capable of removing multiple radio active elements from high level nuclear waste in one step. Just a sprinkling of radioactive elements turns volume of a largely harmless waste into ‘high level radioactive waste’ subject to rigorous and expensive storage standards.

10.71 Such waste is a byproduct of nuclear energy and weapons development and usually contains a mIXthture of intensely radioactive fission products like Strontium-90, Cesium-137 and long lived radioactive elements like plutonium and Americiam plus hazardous and toxic materials. Separating most of the radioactive elements from the other materials can shrink volume of high-level waste, reduce the total disposal cost and minimise potential harm to the people and the environment surrounding it. The Committee was of

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the opinion that an extractant is required that works in one step and removes radioactive strontium, cesium and other Actinides at once.

10.72 Using the UNEX process, trimming the volume of high level waste at least twenty fold, each gallon of waste shrinks to less than a cup and the twenty fold volume reduction leads to a corresponding reduction in disposal costs. The majority of the waste left over after a UNEX separation is far less expensive to treat and store than the highly radioactive portion.

10.73 The Committee suggested that this unique UNEX process of squeezing the volume of enormous nuclear waste to size less than a cup should be studied to depth by DAE and Atomic Energy Regulatory Board (AERB) so that the benefit of the reduction of disposal cost could be enjoyed by the Department as an economy measure for treating, managing and storing all types of radioactive waste e.g. low level, intermediate level and high level nuclear waste etc., and a subsequent feasibility report could be submitted before the Committee for perusal and examination, particularly keeping in view the cost effectivity aspect of the project.

10.74 The Committee has noted that in India, in principle, the Atomic Energy Regulatory Board (AERB) envisages three distinct modes of final disposition in respect of radioactive wastes:-

a) Near surface engineered extended storage for low and intermediate level wastes;

b) Deep geological disposal for high level and Alpha bearing wastes; and

c) Adoption of Closed Fuel Cycle for processing spent fuel to recover fissile materials like Plutonium and Uranium for reuse as fuel in Fast Breeder Reactors. Closed Fuel Cycle is environment friendly.

Keeping this in view the Committee again recommended as follow in its 145th Report:

10.75 The Committee welcomed the idea and feels that this advanced fuel will reduce the cost of production of electricity through FBR and not only that by reducing the capital cost of production of electricity the plant life span will also increase by incorporating better safety features for these reactors. Faster the breeding, quicker will be the rise in the FBR’s capacity. Other nuclear fuels for FBR and PFBR (Prototype Fast Breeder Reactor) like oxide, nitride and carbide fuels may now take the back seat for being used as fuels for FBR.

10.76 The Committee was of the opinion that lower burn up by using carbide fuel is not economical since fabrication and reprocessing would increase cost of power production. However, the Committee felt that long-term strategy calls for fuels with shorter doubling time. Sometimes it is felt that nitride fuel seems to be more preferable due to its easier reprocessing and improved performance.

10.77 The Committee recommended that the Department of Atomic Energy may like to consider the following choices:-

i) High breeding ratio and shorter doubling time

ii) High burn up value and less fuel cycle cost

iii) Faster breeding and quicker capacity of fast breeder reactor

iv) High burn up value and low production cost of power; and between Easy fabrication and reprocessing and low cost of power production before ending itself finally by choosing the most ideal fuel for its FBR and PFBR programme.

10.78 The Committee felt that without choosing the best options from among the above series, the choice of fuel for future reactors of the Department of Atomic Energy may not be optimally fulfilled unless maximum efficiency in power production is derived at least possible opportunity cost.

10.79 Although the Committee felt that TMC is providing state-of-the-art treatment against this killer disease, it would still like to recommend for a new line of research in the field of oncology. The Committee felt that Gene Therapy experiment is the most important therapy for finding a permanent solution against the disease. In Gene Therapy process, the healthy copy of the missing gene is inserted into the cell using a virus known as Adeno-Associated Viral Vector that is no longer harmful and as such it could be termed as a disabled virus. Cells that have been successfully changed by this gene therapy process are separated out, grown and returned to the patient’s body to fight against the disease. In other cases, disabled viruses are used to deliver healthy gene directly to cells within the patient’s body.

10.80 The Committee was also of the opinion that following fields in Cancer Research apart from the above needs research and deep attention.

a) Role of angiogenesis inhibitors in Cancer treatment;

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b) Role of Tumour Suppressor Genes like pRB and p53 in Cancer Control and

c) Role of Farnesyl Transferase Inhibitors (FTIs) – Tumour Necrosis Factor(TNF) and Endothelial Growth Factors Receptors(EGFs) in promoting neoplastic transformation.

10.81 In this connection, the Committee drew the attention of the ACTREC research group to a finding achieved by a group of scientists working in Centre for Cellular and Molecular Biology, (CCMB) Hyderabad where they have been working on RNA interference (RNAi) based therapy for nearly three years. During the visit of the Committee to Centre for Cellular and Molecular Biology, (CCMB) the Committee was apprised that scientists of the institute has pioneered in the field in isolating this unusual transgene silencing in animals. This gene has been targeted in several viral diseases and had successful delivery on human applications. This group of scientists has successfully showed that RNAi controls heterochromatin formation and cell cycle progression. They found a way to control diseases like cancer which are related to cell-cycle progression and cell proliferation which take place almost in different types of tumor formation in cancer. They have also worked on short interfering siRNA for viral inhibition and has generated siRNA for Human Pappilloma Viruses (HPVs). In HPV they have targeted a combination of E6 and E7 genes and coat protein of the virus. Apart from this, this group has also generated a new generation of adeno-associated viral vectors (AAVV) for better delivery of siRNA in different tissues. The Committee felt that such researches may provide a meaningful solution in understanding the mechanism of carcinogenesis and their subsequent control through wider clinical trials of such findings and ultimately applications on human voluteers.

10.82 In view of the importance of the research, the Committee strongly recommended TMC research group and CCMB research group to work in collaboration with each other on such findings so that an effective targeted drug could be designed which may answer the complexities of cure of many forms of cancer with greater successes.

10.83 The Committee understands that one of the greatest sources of extraction of anti-cancer medicine are the oceans and seas of the world. Keeping this in view, the Committee in its 128th Report on Demand for Grants 2004-05 for the Department of Ocean Development recommended for initiatives to be undertaken by the Department for extraction of potentially anti-cancerous drugs from the depth of the ocean. The Committee further recommended that bulbous yellow soft coral that disrupts erratic cell divisions in cancer cells and ocean molds that live in sea grasses are the great source of anti-cancerous drugs. The Committee further recommended that sea sponges are the real source of anti-cancerous drugs and drugs like Didemnin-B that could be isolated from sea squirt, Bryostatin-I that could be isolated from Bugula, Dolestatin-10 that could be derived from Indian Ocean Mollusk and Dolabella, a sea hare are also potential sources of drugs for anti-cancer treatment and other incurable diseases. In response to these recommendations of the Committee, the Department of Ocean development has replied that possibilities are being explored for participation of more and more institutions under the “Drugs from Sea” programme for extraction of potentially anti-cancerous drugs from the depth of the ocean from these microalgae as mentioned above. They have further stated that for understanding the details of Didemin-B from sea squirt, Bryostatin-1 from Bugula and Dolestatin-10 from Indian ocean Mollusc & Dolabella//Seabella the focus from the year 2005-06 onwards would be strengthened to frame comprehensive action plans to study the extraction of these drugs for cancer treatment and pain management etc.

10.84 In pursuance of the above, the Committee recommended strongly that research wing of the ACTREC should jointly collaborate with the Department of Ocean Development for an active participation in the drugs from sea programme for extraction of this potentially anti-cancerous drugs as mentioned above. They should also collaborate with the Department of Ocean Development for a comprehensive action study for giving this extraction of drug project a head start from 2005-06 onwards so that the nature’s prized possession in the form of anti-cancer drugs in sea biology could be utilized functionally to find out a potential answer in curative medicine for the treatment of this dreaded disease named “Cancer”.

10.85 The Committee felt that some precautionary measures should be taken by the Department of Atomic Energy while irradiating foods so that the possible health risks involved before consumption of irradiated food could be effectively dealt with. In this connection, Radiological Safety, Microbiological Safety, Nutritional adequacy and Toxicological Safety measures may be kept in view.

10.86 The Committee felt that long term effects of irradiated food should be studied thoroughly from the point of view of the fact that how ionizing radiation alters chemical structure of food material. This could be managed if a monitored safe label of exposure of food to radiation is laid down by the Department of Atomic Energy.

10.87 The Committee felt that high voltage electron beams generated from linear accelerators which could be a better alternative for food irradiation technology than application of Cobalt-60 and cesium 137 because the

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penetration depth of gama irradiation is not there and with shorter exposure time, the food could be safe with this method. With all other existing methods of food irradiation, the Committee felt only low efficiency could be maintained combined with high cost of production of irradiated foods.

10.88 The Committee felt that in order to make the food irradiation a success, the following factors for judging the bactericidal efficacy of a given dose of irradiation may be adopted:

1. Kinds and species of organism composing the food.

2. Numbers of organisms present because the dose of radiation should be proportional to the number of organism present in the food.

3. Composition of the food.

4. Presence and absence of oxygen

5. The physical state of the food during irradiation including moisture content and temperature.

6. Condition of the organism, that is, its age, temperature for growth etc.

10.89 The Committee was of the opinion that in order to make the entire project of food irradiation a success, the DAE needs to lay down not only certain safety criteria for irradiation, including adequate studies on toxicity aspect of irradiation, long term biological effects of food irradiation, detail assessment of occupational hazards of irradiation, stringent methods to be adopted for improving the operational efficiency of the irradiating machine through lowering cost of irradiation, control over accidental spillage of radiation from place of work and transportation to construction site for placing food irradiation technology that may include high voltage electorn beam generated from linear accelerator but also by placing proper safety label on irradiated food products for its increased public acceptance through informing the consumers adequately and extensively by educating them more about the health advantages of irradiated food.

(g) 146th Report

10.90 In 131st report Committee observed as follows: The Committee observed that given the present state of Wild Life Conservation in India, there are a lot of work to be done in the field to give the word ‘Conservation’ a real meaning. Over the years, the Committee noted that the basic requirements for conservation of wild life have not been fulfilled to its best by the Ministry of Environment & Forests and neither much importance has been attached for the preservation of endangered species of animal and flora which constitute the heart of nature in India.

10.91 In order to give a thrust to the real understanding of the meaning of the term ‘Conservation’, the term Wild Life will have to be interpreted in a different perspective in the broadest sense possible to include scientific work, field work, planning and management, control of poaching and illegal trade, awareness, education and extension of work, eco-development, captive breeding and zoo management etc.

10.92 In order to give a more thrust on the crux of the above definition the Committee felt that following priorities for wild life conservation should be designed by the Ministry during the current plan period:-

1. Control of poaching and illegal trade in wild life and wild life products made of wild life parts;

2. Development of protected areas network.;

3. Welfare measures for wild life staff;

4. Eco tourism;

5. Wild life conservation outside protected areas;

6. Prevention and reduction of damage to wild life;

7. Establishment of second home for the Asiatic lion in Gir.

10.93 So long as the Asiatic lion population remains restricted to a single location, it is at constant risk from catastrophic natural events like forest fire, flood, earthquake etc. Accordingly, efforts should be under way to establish a second population of this endangered species in a suitable animal habitat. As per the Committee’s categorised opinion, Palpur –Kuno in Madhya Pradesh could be identified as the most viable alternative for this purpose.

10.94 For the protection of entire community of flora, the Committee felt that identification of critically important areas and gaps in taxonomic work are required and as per Committee’s opinion such objective could be fulfilled only if Ministry takes the following action:-

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a) Survey and identification of unexplored and underexplored groups of flora;

b) Creation/augmentation of taxonomic expertise and capacity;

c) Introduction of new and desirable fields of information in taxonomic work;

10.95 The Committee also felt that in order to give true effect for the fulfillment of the aforesaid suggestions on the mission of preservation of wild life parks, the Ministry also needs to do the following:-

Protect plants and animals, remove rubbish from the park for keeping it clean, burry toilet waste in the park and keep streams and lakes clean, taking care with fires for preventing any type of serious conflagration, displaying dos and don’ts of careful camping. Keeping a complete track of proper implementation of aforesaid proposals for preserving and respecting wild life cultural heritage of India, reduction of intrusion of visitors into the tiger reserve to reduce animals constant proximity to humans, Wild Life Institute of India should lay down the norms for tourist’s carrying capacity into the parks in order to reduce the tourists influx within the parks ecology and number of vehicles to be allowed inside any park on average shall not be more than 50 per day.

10.96 The Committee was of the opinion that application of Satellite Telemetry Technology for studying wild life behavior and tracking wild animals will be extremely useful in India because this method is significantly helpful for tracking organisms that are otherwise difficult to track via conventional radio telemetry which uses very high frequency radio transmitter. This technology will help in developing a more complete picture of animal’s long distance movements which will assist Department of Wild Life in the way of conservation of endangered species and the preservation of their natural habitats. This technology offers important information about migratory routes of animals and important staging and stop over sites of animals across several thousands of kilometers which is critical for implementing conservation activities over a large area having formidable geographic terrain which are otherwise not available from conventional technologies. The Satellite Telemetry Technology is extremely cost effective. This technology also offers a powerful tool in the conservation efforts especially when it is combined with the landsat image analysis of habitat utilized by the wild life species that are tracked. Keeping this in view, the Committee impressed upon the Ministry that considerable research may be undertaken in the application of Satellite Telemetry Technology for Wild Life Conservation in India.

10.97 The Committee was of the view that following are the endangered species of animals (zoological names are given in the bracket) that the country is now having:-

1. Lion Tailed Macaque (Macaca Silemus)

2. The Asiatic Lion (Pathera leo Persica)

3. The Snow leopard (Panthera Unicia)

4. The Red Panda (Ailurus ochraceus)

5. The Black Buck (Antelope cervircapra)

6. The Slender Loris (Loris Tardigradus)

10.98 The Committee felt that the instant urgency of preservation of the aforesaid species of animals from the death knell of the extinction could hardly be over emphasized. The Ministry is, therefore, required to chalk out a comprehensive management and planning as suggested above for holistic conservation of rare species.

10.99 The most important factor which the Committee felt is responsible for threat to animals existence is the rampart urbanization and increased illegal encroachments on wet lands combined with human folly that has spelt doom to these water bodies and wetlands in the country. Massive siltation and encroachment are ensuring that wetland reduces in size every day. What the ministry needs at this stage is to frame a multi disciplinary approach and strong will to safe guard these endangered water bodies from gradual squeezing by comprehensive de-weeding inside the wet lands so that sufficient support could be given to the preservation of endangered species of animals by giving proper coordination to the implementation programme of the Ministry for preservation of these water bodies. The Committee felt that public awareness need critical augmentation to understand the gravity of the situation that may emerge due to the non-existence of these water bodies.

11 The Committee advocated the idea of cloning of endangered species of animals for saving the endangered groups from the face of extinction. For cloning one species of animal, animal belonging to another species could be used as surrogate mother. The Committee suggested that in order to give an effect to the idea, the

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Ministry of Environment & Forest can design an action plan in consultation with bio-scientists and wild life experts for appropriate collection and freezing of cells/tissue samples of endangered species.

11.1 The Committee in this connection also felt that Centre for Cellular and Molecular Biology, Hyderabad could be the most ideal institute who could be consulted by the Ministry for framing a feasibility report on the idea of cloning of endangered species. While framing the report, cost factor for implementing the project should be taken into account along with the possible practical difficulties including the ethical implication of cloning that may stand in the way of making the project an apparent success.

11.2 The Committee was of the opinion that the destruction and depletion of forests will not only lead to loss of our vegetation but will also result in widespread deterioration of environment with fatal consequences to the very existence of all forms of life. The problem cannot be overcome unless a consciousness is built among the people that they are integral part of the forests and forests belong to them. Besides the feeling of alienation among the tribals and local population should be removed. The Committee, therefore, feels that the local population (including tribals) residing in the forest areas should be actively associated with the management of forests and allowed to share its products, without in any way compromising the preservation of our national forests. The active involvement of people in the development of the forestry sector has to be further strengthened. In addtion of all these measures, the Ministry should also devise steps to inculcate among them a sense of belonging and commitment to forests.

11.3 The Taj Mahal at Agra is one of the most important monuments of not only in India but also the whole world. In recent years owing to growth of satellite industries, the ambient air quality particularly within the Taj Trapezium Area (TTZ) has become more and more vulnerable to severe pollution generating a serious threat to the quality of white marble stones of this remarkable structure. This most celebrated monument viewed from a distance, looms on the banks of a stinking river almost always enveloped in a haze of dust and smog from belching smokestacks and exhaust fumes from the surrounding industries. The Committee felt with a painful heart that this soot and fumes will eventually turn the gleaming white building black.

11.4 It is, therefore, obvious from the above, that in the recent years the corrosive impact of the polluted air on Taj Mahal has become a matter of grave concern. Accordingly, the Committee felt that corrosive impact of pollutants and emissions from surroundings industrial conclave and running vehicles within the vicinity of the monument is required to be addressed on extreme priority basis.

11.5 The Committee has been given to understand that Ministry of Petroleum and Natural Gas has launched a 10 point Programme which is primarily aimed at reducing air pollution for protecting this national monuments from the cancerous effect of pollutants. The Committee, therefore recommend that this 10 Point Programme should be implemented on a war footing basis by a Joint understanding between the Ministry of Petroleum and Natural Gas and Ministry of Environmental and Forests by setting up of a basic task force for joint monitorisation for purposeful implementation of the same.

11.6 The 10 Point Programme inter alia provides for supply of LPG to all households within the Taj Trapezium Area should be settled without any further delay. Supply of unleaded petrol through retail outlets to running vehicles should also be implemented within a set period of time. Preferential allocation of LPG to select industrial and commercial establishments within the TTZ area should also be monitored without any further delay. The sale of high lead contained petrol should altogether be discontinued in the TTZ area. The Committee hoped that supply of unleaded petrol or low lead contained petrol could considerably improve the environmental condition in and around TTZ area. Apart from this, the Committee was of the opinion that the sale of low Sulphur High Speed Diesel Oil should be encouraged within the TTZ area so that the entire 10 Point programme chalked out by the Ministry of Petroleum and Natural Gas could be given a realistic implementation.

11.7 The Committee felt unless basic thrust is given for the implementation of this 10 Point Programme, the day will not be far off when this 17th century architectural splendor will fail to attract enough globetrotters to give them the unfailing message of its exquisite beauty that may linger in the memory for long in the future.

11.8 While the Committee in its 146th report regarding pollution aspects of coal recommended as follows: the Committee was of the opinion that although the coal constitutes a major source catering to the country’s energy needs, possibly with proper technologies and new initiatives for better management, it is possible to reduce the hazards of coal production which is being otherwise caused due to extraction of this mineral without proper planning. Through scientific mining practices followed by land reclamation, beneficiation for ash reduction at source, improvement in combustion methods, use of efficient electrostatic precipitators, bag filters for trapping of fly ash emission and effective management of ash including its utilization for bricks, cement and such other purposes, many of the problems can be prevented and controlled.

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11.9 The Committee was of the opinion that supply of high ash laden coal to power plants not only poses environmental problems but also causes poor plant performance and high cost for ash disposal. The Committee, therefore, strongly recommends that Ministry of Environment and Forests should evolve a mechanism for suggesting measures for improving the quality of coal supplied to the power plants .

(a) Particularly power plants located beyond 1000 kms. from pit head; and

(b) Power plants located in critically polluted areas, Urban sectors and in ecologically sensitive zones.

11.10 The Committee during its study visit to Regional Research Laboratory, Bhubneshwar, held a meeting on 31st January, 2005 with the management of the laboratory and the scientists thereof. During the course of the meeting, inter alia the Committee was informed that a certain section of the research of the laboratory is being directed towards biological desulfurisation of coal for reducing the sulfur dioxide and nitrious oxide emissions i.e. SO2 and NOX into the atmosphere during extract of coal from mines and their subsequent burning. The Committee was also informed that certain research paper has also been released by RRL scientists in the area of bio desulfurisation of coal.

11.11 The Committee was been given to understand by Regbional Research Laboratory that most widely studied microorganism for removal of pyritic sulfur from coal is Thiobacillus ferrooxidans, a Gram-negative, acidophilic, mesophilic, chemoautotrophic, rod-shaped bacterium. The Committee felt that greater researches in this direction by RRL could lead to cost effective microbial processes that can be implemented in pilot plant commercially considering some factors like capacity of reactor for treatment of coal. The Committee has been further given to understand that certain radiation techniques have been reported to be effective for removal of sulfur from coal. The gamma radiolytic pretreatment by ionising gamma rays from Cobalt-60 removes organic sulfur from coal leaving the hydrocarbon matrix of coal unaffected.

11.12 In order to give an effective implementation of the above proposal of the Committee, the following model may be considered by the Ministry of Environment & Forests:

The solubility of additional carbon dioxide in the ocean surface water decreases with rising concentrations. Thus, the relative oceanic uptake of carbon dioxide is reduced at higher concentrations.

The land vegetations may serve as an additional medium term sink for anthropogenic carbon emissions.

The radio-active greenhouse forcing grows only logarithmically with increasing carbon dioxide and Green House Gases (GHG) emissions.

11.13 The environment friendly performance objectives and mechanisms for tracking progress in achieving the prime objective of the aforesaid model for the growth of the oil industry on the one hand and socio-economic sustainability on the other, the implementation of socio-environmental policies involving oil companies and the Ministry of Environment & Forest requires combination of technological advances and innovative approaches.

11.14 The Committee was of the opinion that for addressing the key issues pertaining to the transition of a carbon based economy to a hydrogen economy, the Ministry of Environment and Forests needs to promote the following:

Promote more rapid dissemination and use of efficient, existing commercial technology in strategic and environmentally sensitive areas of the country.

Encourage the development and use of innovative, currently non-commercial technologies.

Enhance the ability of all oil sector companies to achieve and utilize advanced and efficient technologies, and

Improve scientific understanding by addressing well-known uncertainties, in the adoption and implementation of efficient technologies.

11.15 The Committee recommended that to accelerate the pace of research and to provide expertise in different fields of forestry research, the Ministry should impart forestry education and develop forestry curricula at various levels. It should also strengthen the infrastructure and technical capabilities of the universities providing forestry education with necessary grants. The Ministry should also organize seminars and workshops, besides conducting special courses on various forestry themes for the academic advancement of the foresters and those interested in the field of forestry.

11.16 The Committee expressed its serious concern over the sudden disappearance of the Tigers from Sariska Tiger Reserve. The Committee felt that the negligence of Forest staff coupled with the large scale poaching has cost the country dear. Conditions in most of the national parks are more or less same, posing a clear

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danger to protected animal species. Poaching is not a new phenomenon but the poachers are now more advanced with latest weapons and very powerful communication network, making the lackadaisically managed tiger reserves easy picking. In contrast, forest guards are usually equipped with a wooden stick and most of the times without any means of communication. Taking note of this alarming situation, the Committee was of considered opinion that a Special Task Force at the central or state level with the involvement of para-military forces must be constituted to combat the menace of poaching of wild-life.

11.17 Moreover, the Ministry should also involve the villagers living in and around National parks/Tiger reserves to prevent the poaching as they are aware of the tentative movement of the poachers but because of poachers’ threats or any other compulsion, they refrain from coming out openly to help the forest Department to catch the poachers. The Committee strongly recommended that all vacant positions should be filled immediately and at no time any tiger reserve in the country should be left with the junior officers.

11.18 The Committee felt that Project Elephant is a major project of the Ministry but getting less importance. The tusk is as precious as tiger skin and not immune from Poachers. Therefore, the Committee recommended that Elephants should also be protected from the poaching and effective strategy should be evolved for their preservation. In view of decline in Tiger population in Sariska, the Committee suggested the Ministry to undertake an evaluation of Elephant population and take corrective measures accordingly.

11.19 The Committee felt that lakes are critical in sustaining the environmental health of our country. Acting as a huge reservoir, they not only provide water but also recharge and replenish the ground water and prevent floods. Besides, their importance from the point of view of beauty, and aesthetics are well acclaimed. But the Committee was not satisfied with the lackadaisical approach of the Ministry in undertaking the lake conservation schemes. They are moving without any specific targets and objectives. The Committee was anguished to note that even after repeated recommendations of the Committee, the Ministry has not come out with any specific targets to be achieved during a particular period. The Committee expressed its serious concern and recommends that the Government should formulate short-term and long-term plans on lake conservation with specific targets and should proceed further in that direction as per those targets.

VI. Secretariat

11.20 The Committee Section (S&T) headed by a Committee Officer constitutes the Secretariat of the Committee and an Additional Secretary, an Officer on Special Duty, a Deputy Secretary and an Under Secretary remained in-charge of the Branch.

11.21 To assist the Committee in it work, material received from the Ministries/Departments/various non-government organizations and individuals was studied from which points were culled out. The questionnaires for written replies/evidence were also prepared for the use of the Committee.

11.22 The work relating to drafting, consideration and approval of draft reports by the Committee along with their presentation, laying, printing and distribution was undertaken. The Secretariat also dealt with the work relating to the scrutiny of action taken notes received from the Ministries concerned on the recommendations contained in the Reports of the Committee and prepared the Draft Action Taken Reports of the Committee on it.

11.23 The Secretariat also studied material like Parliamentary Debates, Answers to Parliamentary Questions, Budget Estimates, Five Year Plan Documents, Books, Journals, CAG reports, newspapers etc. relevant to the subjects under examination of the Committee.

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ANNEXURE XI (See Para 10.4)

Details of the sittings of the Science & Technology, Environment & Forests during the year 2004

Sl. No.

Date of Sittings

Duration

Hrs./Mts.

Subject Discussed

01. 4.01.2005 0.55 To consider the future programme of the Committee

02. 20.01.2005 1.40

To hear Secretary, Department of Science & Technology on the subject matter of tsunami.

03. 14.03.2005 0.30 Consideration & Adoption of draft 132nd , 133rd , 134th, 135th , 136th , 137th , & 138th Action Taken Reports of the Committee.

04. 28.03.2005 5.10

To hear Secretaries of the Ministry of Environment and Forests and Department of Bio-technology on the Demands for Grants (2005-2006).

05. 30.03.2005 4.45 To hear Secretaries of the Department of Scientific & Industrial Research & Department of Science & Technology on the Demands for Grants (2005-2006).

06. 31.03.2005

2.30 To hear Secretary, Department of Atomic Energy on Demands for Grants (2005-2006).

07. 01.04.2005

4.30

To hear Secretaries of the Department of Ocean Development & Department of Space on the Demands for Grants (2005-2006).

08. 20.04.2005

0.30

Consideration & Adoption of draft 139th, 140th, 141st, 142nd, 143rd, 144th, 145th & 146th Reports of the Committee.

09. 09.05.2005 0.30 To consider the future programme of the Committee.

10. 06.06.2005 0.55 To consider the future programme of the Committee.

11. 05.07.2005 02.20 To hear Secretaries of the Department of Science & Technology & Department of Bio-technology on the aspects related to the Drugs & Pharmaceuticals Programme including Herbal Medicines.

12. 10.08.2005 1.35 Interaction of the Committee with the South African Delegation from the Parliamentary select Committee on Land & Environmental Affairs.

13. 29.08.2005 0.30 To consider the future programme of the Committee.

14. 20.09.2005 2.10 Oral evidence of Secretary Department of Scientific & Industrial Research on Drugs & Pharmaceuticals Programme including Herbal Medicines.

15. 21.09.2005 1.45 Oral evidence of Secretary Department of Ocean Development on Drugs & Pharmaceuticals Programme including Herbal Medicines.

16. 28.10.2005 2.15 Oral evidence of Secretary Department of AYUSH on Drugs & Pharmaceuticals Programme including Herbal Medicines.

17. 18.11.2005 0.25 Consideration & Adoption of draft 147th, 148th, 149th, 150th, 151st, 152nd & 153rd Action Taken Reports of the Committee.

18. 07.12.2005 1.30 Discussion on the matters of Mutual Interests in the field of Science & Technology with the delegation of the Committee on Science, Technology & Environment of the National Assembly of Vietnam.

19. 20.12.2005 1.05 Consideration & adoption of revised draft 147th, 148th, 149th, 150th, 151st & 152nd Action Taken Reports of the Committee.

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CHAPTER XI

COMMITTEE ON TRANSPORT, TOURISM AND CULTURE

I. Composition of the Committee 11. The Department-related Parliamentary Standing Committee on Transport, Tourism and Culture was constituted on 5th August 2004 and continued upto the 4th August 2005. The Committee was again reconstituted on 5th August 2005. The total number of the Members of the Committee was 31 out of which 10 Members were from Rajya Sabha and 21 Members from Lok Sabha. 11.2 The Committee consisted of following Members: —

COMMITTEE ON TRANSPORT, TOURISM AND CULTURE (As on 5.8.2004)

1. Shri Nilotpal Basu - Chairman

RAJYA SABHA 2. Prof. Ram Deo Bhandary 3. Shri S.S. Chandran 4. Shri Dara Singh Chauhan 5. Smt. Hema Malini 6. Shri Janardhana Poojary 7. Shri Satish Kumar Sharma 8. Shri Shatrughan Sinha 9. Shri Rama Muni Reddy Sirigireddy 10. Smt. Ambika Soni

LOK SABHA 11. Shri Ramdas Athawale 12. Shri Raj Babbar 13. Shri Anil Basu 14. Shri N.S.V. Chitthan 15. Shri Adhir Ranjan Chowdhury 16. Dr. K. Dhanaraju 17. Shri Dip Gogoi 18. Shri Vijay Kumar Khandelwal 19. Shri W. Wangyuh Konyak 20. Dr. Ramkrishna Kusmaria 21. Shri Samik Lahiri 22. Shri Sudam Marandi 23. Shri Alok Kumar Mehta 24. Shri Ravindra Naik 25. Shri Gingee N. Ramachandran 26. Shri Manabendra Shah 27. Shri Dushyant Singh 28. Shri Madan Lal Sharma 29. Shri Sartaj Singh 30. Shri Chengara Surendran 31. Shri Umakant Yadav

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COMMITTEE ON TRANSPORT, TOURISM AND CULTURE (As on 5.8.2005)

1. Shri Nilotpal Basu - Chairman

RAJYA SABHA 2. Shri Kamal Akhtar 3. Prof. Ram Deo Bhandary 4. Shri S.S. Chandran 5. Smt. Hema Malini 6. Shri Janardhana Poojary 7. Shri Satish Kumar Sharma 8. Shri Shatrughan Sinha 9. Shri Rama Muni Reddy Sirigireddy 10. Smt. Ambika Soni

LOK SABHA

11. Shri Ramdas Athawale 12. Shri Raj Babbar 13. Shri Anil Basu 14. Shri Sartaj Singh Chhatwal 15. Shri N.S.V. Chitthan 16. Shri Adhir Chowdhury 17. Dr. K. Dhanaraju 18. Shri Ravindra Naik Dharavath 19. Shri Dip Gogoi 20. Shri Vijay Kumar Khandelwal 21. Shri W. Wangyuh Konyak 22. Dr. Ramkrishna Kusmaria 23. Shri Samik Lahiri 24. Shri Sudam Marandi 25. Shri Alok Kumar Mehta 26. Shri Gingee N. Ramachandran 27. Shri Manabendra Shah 28. Shri Dushyant Singh 29. Shri Madan Lal Sharma 30. Shri Chengara Surendran 31. Shri Umakant Yadav II. Subjects selected for examination 11.3 The Department-related Parliamentary Standing Committee on Transport, Tourism and Culture selected the following two new subjects for examination:—

Sl.No. Ministry/Deptt. Subjects

1. Ministry of Tourism Functioning and Performance of India Tourism Development Corportion (ITDC)

2. Department of Road Transport and Highways

Functioning of National Highways Authority of India (NHAI)

III. Review of work done (a) Sittings of the Committee

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11.4 During the year the Committee held 33 sittings for 58 hours and 10 minutes. A Statement showing the dates of sittings of the Committee held during the period under Review, the duration of the sittings and the subjects discussed are given in Annexure-XII. (b) Study Visits 11.5 The Committee undertook one study visit for a total number of six (6) days. Officers/Staff of the Secretariat accompanied them. The section also prepared study notes after the Committee visit. The details of the visit are given below:-

Destination Date Organisation Examined

Subject

Imphal, Aizawl, Guwahati & Shillong

1.2.2005 – 6.2.2005 Airport Authority of India and Ministry of Civil Aviation.

Development of Imphal Airport.

Tour/Travel/Hoteliers Associations, Ministry of Tourism, Government of India and Government of Manipur

Development of Tourism in Manipur.

Tour/Travel/Hoteliers Associations, Ministry of Tourism, Government ofIndia and Government of Mizoram

Development of Tourism in Mizoram.

Airport Authority of India and Ministry of Civil Aviation.

Development of Aizawl Airport.

National Highways Authority of India and Department of Road Transport and Highways.

Development of National Highways in the North Eastern Region.

Tour/Travel/Hoteliers Associations, Ministry of Tourism, Government of India and Government of Meghalaya

Development of Tourism in Meghalaya.

Indian Airlines and Ministry of Civil Aviation, Jet Airways, Air Sahara and Air Deccan.

Operation of flights in the North-East region of the country.

IV. Reports presented 11.6 During the year under review, Eight (8) Reports of the Committee were presented to both the Houses of Parliament as detailed below:-

Report No.

Report Date of Adoption Date of Presentation

84th Demands for Grants (2005-2006) of Department of Road Transport & Highways

15.04.2005 29.04.2005

85th Demands for Grants (2005-2006) of Ministry of Culture

15.04.2005 29.04.2005

86th Demands for Grants (2005-2006) of Department of Shipping

21.04.2005

29.04.2005

87th Demands for Grants (2005-2006) of Ministry of Tourism

21.04.2005 29.04.2005

88th Demands for Grants (2005-2006) of Ministry of Civil Aviation

27.04.2005

29.04.2005

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89th The Merchant Shipping (Amendment) Bill, 2004 (with evidence)

06.06.2005

27.07.2005

90th Development of Airport Sector with Special Emphasis on New Modern Airports

17.08.2005 23.08.2005

91st Functioning of the Archaeological Survey of India 19.09.2005 25.11.2005 V. Summary of Recommendations (a) 84th Report 11.7 The Committee felt that the Department of Road Transport and Highways failed to make optimal utilization of the funds at its disposal. The reasons for shortfall mentioned were delay in land acquisition, poor performance of the contractors, law and order problem etc., which were very general in nature and repeated every year. As a result of these, the budgetary allocations of the Department were reduced at RE stage. The Committee was of the view that there was a lack of monitoring system in the Department of Road Transport and Highways. The lack of a proper monitoring system in the Department was exemplified by the delay and non-completion of the construction of flyover at Murthal in Haryana and the failure of the Department of Road Transport and Highways in verifying the credentials of the contractors who had submitted forged bank guarantees. The Committee, therefore, recommended that the Department of Road Transport and Highways should devise necessary strategies to identify bottlenecks causing delays and work towards resolving all such hindrances in coordination with all the concerned agencies. This would also help them to avoid time overrun and consequential cost overrun of the projects to be executed by them.

11.8 The Committee felt that in view of the huge resource gap of around Rs.1,06,000 crore in the road sector during the Tenth Plan, there was a genuine need to attract private sector investment in this sector to a large extent. However, the Government was not able to attract private sector investment to the desired extent. The Committee recommended that the Government should project the success of the Golden Quadrilateral to the private sector to encourage them to contribute more and more to the development of this sector. This would definitely help the Government to reduce the resource gap position to a large extent. 11.9 The Committee observed that one of the objectives for the Tenth Plan for the road sector was ‘Development of roads to be considered an integral part of the total transport system supplementing other modes, integrating the development plans with railways and other modes of transport’. The Committee was of the view that the modal-mix in terms of transport was very adverse in the country in spite of the presence of long inland waterways, a fairly large railway network and the recent upsurge in the aviation and road transport sector. The Committee, therefore, recommended that the Government should come forward with an integrated transport policy to make optimum utilization of the various transport facilities available in the country.

11.10 The Committee observed that the Tsunami waves caused extensive damage to the road network and bridges in the Southern Parts of the country. The Committee appreciated the promptness with which the Department of Road Transport and Highways responded to the situation and carried out the relief measures in the tsunami hit areas. The Committee strongly recommended that the Department should consider the proposals submitted by the State Governments for restoration of the damages on priority basis so that construction/repair works could be carried out at the earliest. The Committee further observed that damage to the National Highways had badly affected the tourism potential in the Andaman & Nicobar Islands, which was the lifeline of these islands. The Committee recommended that priority should be given to the restoration of the National Highway network and bridges etc. in these islands.

11.11 The Committee was of the view that the Department of Road Transport and Highways, as the agency for distribution of funds under this head, should ensure optimum utilization of funds. The Committee recommended that Department of Road Transport and Highways should impress upon the concerned agencies/NGOs about the need for early completion of formalities and submission of relevant documents so that the funds earmarked for the purpose during a particular year were not underutilized.

11.12 The Committee was of the view that vehicular emission has become one of the major sources of environmental pollution and the share of the transport sector in total emissions was a matter of serious concern. The Committee appreciated the steps taken by the Department of Road Transport and Highways in controlling vehicular pollution. The Committee recommended that the Department of Road Transport and

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Highways should impress upon the State Governments the need for effective monitoring and enforcement of these norms for on-road vehicles so as to minimize its ill effects.

11.13 The Committee expressed its concern that in the absence of user-friendly public transports, excessive use of private vehicles and undue pressure on roads. The Committee observed that most of the investment on roads was being extracted from the public itself but the returns accruing to the users were not equitable. The Committee, therefore, recommended that the efforts of the Government should focus on developing public transport, which discourage excessive use of private vehicles. (b) 86th Report 11.14 The Committee felt that Department of Shipping did not evolve effective system or planning to systematically anticipate, assess and project its actual requirements of funds otherwise the investments could have yielded commensurate returns. The Committee recommended that in future, the Department of Shipping should be transparent and realistic while making projections of required funds so that resources may not remain unused and are allocated more judiciously. 11.15 The Committee was unhappy with the poor performance of Department of Shipping with regard to under utilization of approved outlays over the years for the port sector. During the Financial year 2004-05, an outlay of Rs.1066.55 crore was allocated for the port sector but the ports could utilize only Rs.440.51 crore. The Committee was dismayed by this repeated failure of Department of Shipping and was surprised as to why the Ministry asked for so much of allocation if it was not in position to spend the approved outlay. 11.16 The Committee noted that six major ports- Mumbai, Mormugao, New Mangalore, Kochi, Tuticorin and Chennai were identified for the development of infrastructure and other facilities with a view to make India an attractive cruise destination. The Committee noted that a High Power Steering Group was set up with a view to catalyze the growth and development of cruise shipping and to remove bottlenecks. The Committee desired that the group should submit its report expeditiously and the policy should be framed at the earliest so that the benefit of opportunity available to cruise tourism sector could be exploited. 11.17 The Committee was distressed to note that the employees of the Calcutta Dock Labour Board were not being treated as Government employees so far as payment of pension and pensionary benefits were concerned, though, the Calcutta Dock Labour Board, a body corporate, was constituted in terms of section 5(A) of the Dock Workers (Regulation of Employment) Act, 1948 in September 1952. The Committee expressed its concern that in spite of specific provisions under the Act, the rules and regulations concerning pension for employees of Calcutta Dock Labour Board were not been approved by Department of Expenditure and the employees of Calcutta Dock Labour Board were being made victims under the cover that Calcutta Dock Labour Board constitutes an autonomous body and therefore, denied of the benefits for long.

11.18 The Committee was deeply concerned that the shortage to the tune of Rs.92.78 crore in Seamen's Provident Fund, which lost due to security scam, has not yet been recouped by the Department of Shipping. The Committee was unable to comprehend the reasons for delay in recouping the fund, which is entirely managed by the Government and feels that any further delay may cause adverse impact in protection of interests of the seamen's whose life long savings stands jeopardized in the scam. The Committee, therefore, recommended the Department of Shipping to approach the Ministry of Finance for grants-in-aid to recoup the shortage in the Seamen's Provident Fund.

(c) 87th Report 11.19 The Committee noted that with an aim to improve the existing destinations and circuits and to develop new destinations and tourists circuits of world class standard, the Ministry of Tourism merged the existing two scheme of Integrated Development of Tourist Circuit and Product/Infrastructure and destination development into one single scheme as Product/Infrastructure Development of Destinations and Circuits. However, the Committee was surprised to note that the tourism potential and uniqueness of some of the important States like Jharkhand, Rajasthan, Tamilnadu, West Bengal, Uttar Pradesh and Uttranchal for convergence of resources and development of Circuits and Destinations of international importance has not yet been fully explored by the Ministry. The Committee recommended that more Circuits and Destinations region-wise should be identified in consultation with the State Governments and developed in an integrated and holistic manner for the purpose of convergence of resources and world-class benchmarking, the related

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Ministries and Department of State Governments should have sub-plans in their annual plans so that tourism related infrastructure projects receive the highest priority. 11.20 The Committee noted that a proposal to include Tourism in the concurrent list was mooted by the Ministry for giving Constitutional recognition to tourism and development of tourism in a systematic manner. As result of which so far as 29 States/Union Territories agreed for placing tourism in the concurrent list and 6 States opposed the proposal. The Committee felt that India’s tourism products would grow only when the suitable legislative and regulatory support was provided. 11.21 The Committee noted that during the year 2003, around 6 million Indians visited abroad against a total incoming flow of 2.73 million foreign tourists, and more and more countries were queuing up to attract the Indian tourists, which led to foreign exchange outflow. The Committee observed that by diverting Indian tourists going abroad to Indian destinations, massive potential for domestic tourism could be explored and this required focussed approach for its growth. The Committee was of the view that the growth of global tourism depended upon the domestic tourism and it was easier to target the domestic tourism market as compared to the international market. The Committee felt that a relative change in the marketing strategy was required for tapping the domestic and international tourism markets and recommends that special emphasis should be laid for accessing the market by consolidation of efforts to arrest the increasing trend of outbound tourists. 11.22 The Committee was of the view that Andaman & Nicobar Islands with its flora, fauna, forest and underwater marine life, possessed the potential of growing into top tourist destinations in the world. However, the tourism scenario in the island severely affected by tsunami recently and there was an urgent need to rebuild the image of the islands and gain the confidence of the tourists. The Committee recommended that Government of India should, in coordination with the local Government formulate specific programme for capital investment and rebuilding the infrastructure by giving subsidy and incentives, in a time bound manner besides opening of more Islands for the Indian as well as foreign tourists to generate employment opportunities and strengthening the overall economy of the Islands keeping in view the ecological and anthropological sustainability of the region. 11.23 The Committee expressed its serious concern on the indiscriminate mining activities and desired the Ministry of Tourism to develop these caves as a unique tourism product. The Committee was constrained to note that some of the major impediments for the growth and development of tourism in North Eastern Region were weak road links, inadequate Rail and Air connectivity, high luxury tax on room rents, high inter-state permit tax, lack of parking facilities, frequent check-posts on National Highways, mandatory permit system, ILP/RAP/PAP, law and order situation, bottlenecks in infrastructure amenities, financial constraints, trained man-power, monitoring and coordination and lack of entrepreneurship etc. The Committee emphasizes upon the need for comprehensive and integrated approach to resolve the problems faced by the North East region and to take measures for infrastructure and destination development besides prioritizing the projects to give renewed boost to the development of tourism in the region. (e) 88th Report 11.24 The Committee notes that there was a contradiction between the objectives stated by the Ministry of Civil Aviation in allowing private airlines to fly to international destinations and the routes actually allotted by the Ministry of Civil Aviation to the private airlines. The Committee observed that the basic objective of the Government in allowing private airlines to fly to international destinations was for providing connectivity to such destinations which the Ministry had not been able to provide in the past because of lack of capacity of Air India and Indian Airlines. However, the Ministry of Civil Aviation had granted permission to these private airlines to fly to those destinations which were already being serviced by Air India and Indian Airlines. Hence the stated position of the Government in this respect was in total contradiction with the actual decisions of the Government and the basic objective of the Government to provide connectivity to new international destinations had been defeated.

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11.25 The Committee was of the view that the present aviation policy being followed by the Government was not effective in making the private airlines share the social obligations of the country. The Committee felt that the private airlines have been focusing on lucrative trunk routes only. Those airlines were operating only on the basis of commercial terms and tend to follow the bare minimum of what is mandatory for them under the Route Dispersal Guidelines. The Committee recommended that the Route Dispersal Guidelines should be revisited to ensure that the private domestic airlines also share the social obligation of connecting remote parts of the country in the true sense and not by merely completing the formalities in this regard. 11.26 The Committee was constrained to note that while the current policy of the Government aimed at allowing more and more airlines to operate in the country, it was not made obligatory for them to utilize the modern facilities installed at the airports with huge investments for the convenience of the passengers. The Committee was surprised to note that the three private airlines i.e. Jet Airways, Sahara Airlines and Air Deccan had not trained any of their pilots for CAT-III operations and there was no legal requirement in the Aircraft Rules and Civil Aviation requirements to make it mandatory for private airlines to train their pilots on ILS CAT-III System. The Committee was also not satisfied with the progress achieved with respect to the training of the pilots by the National Carriers viz. Indian Airlines and Air India, for utilizing the CAT-III System. The Committee recommended that in order to improve the operational efficiency during the extreme foggy conditions, the Ministry should amend 'Aircraft Rules' to incorporate a provision for making training of pilots compulsory by the private airlines on CAT-III System so that the investment made by the Government on the installation of the system through the tax payers' money was not underutilized. (f) 89th Report

11.27 The Committee agreed with the views of the Government that if the ISPS Code was not implemented the Indian ships & port facilities might act as a non-tariff barrier for sea borne commerce. It appeared to the Committee that current assessment of security threat to shipping sector was basically the consequence of 9/11 attack on U.S.A. whereas, terrorism has a much longer history. However, International Maritime Organization ignored that fact and suddenly woke up to the threat of security and agreed unanimously to the evolution of new measures relating to ships and port facilities post 9/11. The Committee did not approve the contention of the Secretary that the ISPS Code provided both voluntary as well as mandatory provisions. The Committee felt that security perception was a sovereign function and it was country specific. It was not fair, therefore, to confuse between our own security requirements and demands of international trade. Protecting the nation, was a sovereign function of the Government. The Committee, therefore, recommended the Department of Shipping to look into the national priorities and interests while implementing the ISPS code.

11.28 The Committee recognized that our constitution empowers the Government to enter into international agreements and no subsequent ratification by the Parliament was necessary. However, if such agreements warranted any legislative change subsequently, then powers of the Parliament were final. Therefore, the Government should be mindful of that flexibility. 11.29 The Committee noted that IMO was not the body to deliberate upon the role of Armed forces in relation to their sovereign powers in protecting their national security interest and the scope of ISPS Code was confined to only preventive measures to deter and detect and the role of armed forces was to respond to any security incident reported by ships or port facilities. The Committee felt that the problem of security was very old and the security requirements were becoming far too complex to be handled in the manner they were being handled in the past. Therefore, an international organisation which was primarily engaged in commercial activity through sea route should not have been involved in the business of security and some defence related agencies i.e. Navy and Armed forces should have essentially dealt with this kind of a code. The Committee therefore, recommended for creation of a Maritime Security Advisory Committee to report on and make recommendations on National Maritime Security matter under the Ministry of Defence so that all commerce handled by the Port and Ships would achieve appropriate security coverage.

(g) 90th Report 11.30 The Committee was constrained to note that the proposal regarding modernization and restructuring of Delhi and Mumbai airports had been lingering on for a fairly long period and still the Government had not been able to come up with any concrete plans in this regard. The Ministry of Civil Aviation had also not been able to even firm up the financial requirements for these projects. The Government was quoting different cost estimates at different stages. The Committee also noted that the initial figures of Rs.10,000 crore to

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Rs.20,000 crore stated by the Secretary of the Ministry were too inflated and also gave the impression that the money was required immediately in one go which infact was actually required in phases spread over 15 to 20 years. The Committee felt that the process of modernization as explained by the Ministry, was very slow and the target to be achieved was also minimal in terms of global standards. The Committee observed that Airports Authority of India at present had already achieved the target with the present rate of investment. The Committee did not agree with the Ministry of Civil Aviation that resource crunch was the main reason for inviting private sector participation for the modernization and restructuring of Delhi and Mumbai airports. The quantum of investment which was to the tune of Rs.13,786 crore, required for modernization of Delhi and Mumbai airports was not on the higher side and that too was required in a phased manner over a period of 15 to 20 years. The Committee felt that the Government could have even mobilize the funds required. That would have ensured not only the management control of the proposed operators of the airports in the hands of Indian nationals but also resulted in protecting the safety, security and sovereignty of the country. 11.31 The Committee observed that the replies of the Ministry of Civil Aviation in the context of award of contracts at Bangalore International Airport Limited were evasive and highly unsatisfactory. The Committee noted that the Ministry of Civil Aviation was aware that as per the provisions of the concession agreement of BIAL, the promoters themselves would be participants in executing contracts. Since the equity holders were themselves the service providers in Bangalore International Airport Limited, there was certainly a case for conflict of interest involved in Bangalore International Airport Limited. The Committee highlighted that it had expressed its apprehensions on the issue during the oral evidence of the representatives of Ministry of Civil Aviation held on the 8th November 2004. However, at that time, the Ministry of Civil Aviation had not accepted the observations of the Committee. Ministry of Civil Aviation had, on the other hand, emphasized that there was an open tendering and there would be no conflict of interest reflected in the awarding of the contracts. 11.32 The Committee was distressed to note that the Ministry of Civil Aviation had decided to shut down the existing airport at Hyderabad for commercial operations. The Committee could not understand as to why such kind of concessional agreement was signed when the Ministry itself was of the opinion that the present terminals could be utilized at least for one more decade. The Committee also expresseed its doubt as to how the Ministry was planning to compensate with the losses to be incurred, in case the existing terminal at Hyderabad was closed, by developing shopping complexes, housing etc. on commercial basis. The Committee was opposed to this move of the Government for closing the existing airport at Hyderabad for commercial flights once the new Hyderabad International Airport Limited was operational and urged the Government to reconsider that decision.

11.33 The Committee strongly recommended that the status of 'Mini Ratna' should be accorded to the Airports Authority of India to ensure adequate opportunity to utilize its professional excellence in the area of development and maintenance of airports in the country. The status of 'Mini Ratna' would certainly strengthen the hands of Airports Authority of India by providing more functional autonomy which would in effect also ensure a speedy progress of decision-making in financial matters.

11.34 The Committee was of the opinion that connectivity was an important element in the optimum utilization of the airports. The Committee noted that due to problems of capacity and locational constraints, the new airports were being planned outside the city centers. The utilization of the Greenfield airports and the existing airports would greatly depend on the kind of connectivity that would be provided to these airports from the city centers. The Committee cited the example of Kuala Lumpur airport which is 85 kilometers outside the city but that distance could be covered in just 35 minutes. The Committee, therefore, recommended that the Ministry of Civil Aviation should emphasize upon the respective state governments to provide connecting link to the airport terminals on the same standard and specifications as the expressways so that the approach and exit time to and from the airports could be reduced to a large extent. 11.35 The Committee was of the view that with the arrival of new private domestic airlines and expansion of fleet by the existing airlines in the country, there was an urgent need to create parking space and other infrastructural facilities at the airports. The Committee was constrained to note that before giving licenses to new airlines to commence operations, the Government did not deliberate on the infrastructure and maintenance facilities like, taxi ways, additional bays, runways etc. required at the airports. As a result of that, the already congested infrastructure available at the airports has come under tremendous stress. The Committee was of the view that no transparent policy was being followed for allotment of parking space. The Committee recommended that the Government should draw up a comprehensive assessment of the requirement of infrastructural facility required in future.

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11.36 The Committee was of the view that Delhi and Mumbai airports were most constrained in terms of infrastructure and that with the growth of civil aviation sector in the country, the pressure and strain on these airports was also increasing. There was, therefore, a need for development of alternative centers to ease the pressure at these airports. 11.37 The Committee was of the opinion that exercising vigilance over the new airlines coming up in the country and their methods of seeking permission for procurement of aircraft and allotment of parking bays at airports was quite essential. The Committee recommended that the role of all concerned agencies i.e., Airports Authority of India, DGCA, etc. in that regard should be closely monitored and compliance of all necessary regulations ensured.

11.38 The Committee recommended that the groundwork relating to development of non-metro airports should be completed without losing much time and these non-metro airports should not be marginalized. The Committee further recommended that the Ministry of Civil Aviation should expedite the work of appointing Technical Advisor and Financial Consultant in order to assess traffic growth and to finalize financial mode etc. The Committee felt that development of non-metro airports would help in improving connectivity as well as firmly linking up newly emerging cities having tremendous tourism and business potential with the mainstream. 11.39 The Committee noted with concern that there was widespread encroachment of land of Airports Authority of India at various airports in the country. The Committee regreted that Airports Authority of India had not been able to take due care of its assets as a result of which developmental activities at many airports suffered. The Committee recommended that Airports Authority of India should take up the matter regarding removal of encroachments with the concerned state governments. (h) 91st Report

11.40 The Committee noted that the ASI had drawn long-term programme to protect all 3663 monuments/sites of national importance out of which 3537 monuments/sites were unticketed. Those monuments were classified into three categories viz. Group A, B and C for convenience. The Committee was however aware that there are many sites/monuments under the protection/maintenance of Archaeological Survey of India which were located in interior areas of various States but were lying unattended. Therefore, the Committee recommended that Ministry of Culture should equally treat the revenue earning and not-earning sites and efforts should be made for integrated infrastructure development and conservation/ preservation of all monuments/sites with encompassing facilities for tourists, so as to give a major fillip to cultural tourism in the country as well as attracting overseas visitors.

11.41 The Committee was not in agreement with the argument put- forth by the Ministry of Culture that the appointment of generalist administrator as Director General would not hamper the development of Archaeological Survey of India as a scientific organisation. The Committee was shocked to note that even after the Gazette Notification of May 2002, the Government was able to fill up the post of Director General, Archaeological Survey of India as per the requirements of the Notification and has been merely filling up the post from Indian Administrative Service on deputation basis. Therefore, the Committee recommends that steps should be taken to fill up the post of Director General, Archaeological Survey of India as per the requirements of the Notification of May 2002, at the earliest. 11.42 The Committee was constrained to note that even after a lapse of fifteen years from the date of issue of the Notification in this regard no concrete action was taken by Ministry of Culture and Archaeological Survey of India for developing Archaeological Survey of India as a Scientific and Technical Department, which amply indicates the administrative apathy towards the whole issue. The Committee regrets that no internal exercise was undertaken by Ministry of Culture and Archaeological Survey of India during the last fifteen years for availing the benefits and privileges which could be extended to the Archaeological Survey of India as a Science and Technology department. The Committee recommended that the Ministry of Culture and Archaeological Survey of India should, without any further loss of time, take necessary follow-up action on the recommendations of the Committee chaired by Director General, Archaeological Survey of India so as to avail the benefits which accrue to a Science and Technology department. The Committee also recommends that, if required, the Ministry of Culture should also take necessary legislative action to make Archaeological Survey of India Science and Technology department in the true sense.

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11.43 The Committee was of the firm view that Sarasvati Heritage Project did not conform to the criterion fixed for excavation of archaeological sites since no academic body or university had recommended the project. The Committee also noted that there was an element of contradiction in the replies submitted to the Committee by the Department of Culture. On the one hand, the Ministry of Culture stated that the former Minister of Tourism and Culture was not the Chairman of the Sarasvati Heritage Project, while, on the other hand, the Ministry had stated that prior to the preparation of the project report, the Government had constituted an Advisory Committee with the then Minister of Tourism and Culture as Chairman and that Committee had recommended the Saraswati Heritage Project. The Committee further notes that the Ministry was not clear as to which research agency/scientific survey actually pointed out that the dry beds of River Ghaggar and River Chautang (River Drisadvati) were the bed of River Sarasvati. The Committee understood that existence of River Sarasvati was purely a mythological one and a scientific institution like Archaeological Survey of India has not correctly proceeded in the matter. The Committee regreted to note that a major project to the tune of Rs.36.02 crores was prepared which was, however, subsequently reduced to Rs.4.98 crores just to excavate a mythological river whereas, several other monuments/heritage sites of national importance were languishing in neglect due to acute shortage of funds. The Committee recommended that Archaeological Survey of India should strictly adhere to the criterion fixed for selection of excavation of sites. Further, decisions for excavations should be made on the basis of proper scientific and technical appraisal and no extraneous factors should go into the decision making. The Committee also recommended that before selecting a site for excavation, the Archaeological Survey of India should very carefully examine the potential of the site so that funds earmarked for the same do not go waste. The Committee advised the Archaeological Survey of India that it should prevent itself from taking up exercises without a scientific basis which have all potentiality for subjective interpretation of historical facts thereby, leading to controversies. 11.44 The Committee was of the view that if excavation reports were not written, then all the taxpayers’ money spent on them would go waste. Also, due to non-publication of excavation reports, the achievements of Archaeological Survey of India largely remained unnoticed by the public. V. Secretariat 11.45 The Committee Section (Transport and Tourism) headed by a Committee Officer constitutes the Secretariat of the Committee. An Under Secretary remained incharge of the Branch and a Director and a Additional Secretary supervised at higher levels. 11.46 To assist the Committee in its work, material received from the Ministries/Departments/various non-official organizations and individuals was studied in detail and based on the material available with the Committee questionnaire for written replies/evidence were prepared for the use of the Committee. 11.47 The Secretariat collected material for on-the-spot study and prepared study tour notes. 11.48 The work relating to drafting, consideration and approval of draft reports by the Committee alongwith their presentation, laying, printing and distribution was undertaken. The Secretariat also dealt with the work relating to the scrutiny of action taken notes received from the Ministries concerned on the recommendations contained in the Reports of the Committee and preparation of Draft Reports of the Committee on the Action Taken Reports. 11.49 The Secretariat also studied material like Parliamentary Debates, answers to Parliamentary Questions, Budget Estimates, Five Year Plan Documents, Books, Journals, newspapers etc. relevant to the subjects under examination of the Committee.

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ANNEXURE-XII (SEE PARA 11.4)

Details of the sittings of the Committee on Transport, Tourism and Culture during the year 2005

S. No.

Date of Meeting Duration Hrs.-Mts.

Main Items of Agenda Evidence taken, if

any

1. 07.1.2005 0-20 The Committee considered its future programmes and finalise the study visit of the Committee to North-Eastern Region.

-

2. 17.1.2005 2 -10 The Committee heard the views of Secretary, Department of Shipping on the Merchant Shipping (Amendment) Bill, 2004.

Secretary, Department of Shipping

3. 27.1.2005 0-30 The Committee considered the Merchant Shipping (Amendment) Bill, 2004.

-

4. 14.2.2005 1- 45 The Committee heard the views of Shri Raman Puri, Vice Admiral, Ministry of Defence and Shri M.P. Pinto, Ex-Secretary, Department of Shipping on the Merchant Shipping (Amendment) Bill, 2004.

Shri Raman Puri, Vice Admiral, Ministry of Defence and Shri M.P. Pinto, Ex-Secretary, Department of Shipping

5. 15.2.2005 1-10 The Committee heard the views of Shri P.K. Samantaray, Working President, Indian National Port and Dock Worker’s Federation on the Merchant Shipping (Amendment) Bill, 2004. The Committee also considered the functioning of Archaeological Survey of India.

Shri P.K. Samantaray, Working President, Indian National Port and Dock Worker’s Federation

6. 23.2.2005 1-30 The Committee heard the views of Shri Abdulgani Y. Serang, General Secretary, All India Port & Dock Workers Federation and the Secretary, Department of Shipping on the Merchant Shipping (Amendment) Bill, 2004.

Shri Abdulgani Y. Serang, General Secretary, All India Port & Dock Workers Federation and the Secretary, Department of Shipping.

7. 17.3.2005 1-15 The Committee heard the views of Shri M.K. Venu. Sr. Journalist, The Economic Times on the Demands for Grants (2005-06) relating to the Ministry of Civil Aviation, Tourism and Department of Road Transport and Highways.

Shri M.K. Venu. Sr. Journalist, The Economic Times

8. 18.3.2005 1-30 The Committee heard the views of Shri Ashwani Phadnis, Special Correspondent, Hindu Business Line and Ms. Jyoti Mukul, Sr. Journalist, Business Standard on the Demands for Grants (2005-06) relating to

Shri Ashwani Phadnis, Special Correspondent, Hindu Business Line and Ms. Jyoti

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the Ministry of Civil Aviation and Department of Shipping.

Mukul, Sr. Journalist, Business Standard.

9. 29.3.2005 2- 40 The Committee took up the examination of the Demands for Grants of Ministry of Culture for the year 2005-06 and heard the views of the Secretary of Ministry on the subject.

Secretary, Ministry of Culture

10. 30.3.2005 3-0 The Committee took up the examination of the Demands for Grants of Ministry of Civil Aviation for the year 2005-06 and heard the views of the Secretary of Ministry on the subject.

Secretary, Ministry of Civil Aviation

11. 31.3.2005 5-40 The Committee took up the examination of the Demands for Grants of the Department of Road Transport and Highways and Ministry of Tourism for the year 2005-06 and heard the views of the Secretaries of the Department/Ministry on the subject.

Secretaries, Department of Road Transport & Highways and Ministry of Tourism

12. 04.4.2005 2 -40 The Committee took up the examination of the Demands for Grants of Department of Shipping for the year 2005-06 and heard the views of the Secretary of Department on the subject.

Secretary, Department of Shipping

13. 05.4.2005 2-45 The Committee took up the examination of the Demands for Grants of Ministry of Civil Aviation for the year 2005-06 and heard the views of the Secretary of Ministry on the subject.

Secretary, Ministry of Civil Aviation

14. 15.4.2005 2-10 The Committee considered the draft 84th and 85th reports on Demands for Grants (2005-06) of the Department of Road Transport & Highways and Ministry of Culture, respectively, and after some discussion, adopted the reports with minor modifications.

-

15. 21.4.2005 1-30 The Committee considered the draft 86th and 87th Reports on Demands for Grants (2005-06) of the Department of Shipping and Ministry of Tourism, respectively, and after some discussion, adopted the reports with minor modifications.

-

16. 27.4.2005 1-15 The Committee considered the draft 88th Report on Demands for Grants (2005-06) of Ministry of Civil Aviation and after some discussion, adopted the report with minor modifications.

-

17. 26.5.2005 0-20 The Committee considered its future programme.

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18, 6.6.2005 2-15 The Committee considered the draft 89th Report on the Merchant Shipping (Amendment) Bill, 2004 and after some

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discussion, adopted the report with minor modifications. Thereafter, the Committee took-up further consideration of the 'Development of Airport Sector with special emphasis on new modern airports’ and heard the views of the representatives of the Ministry of Civil Aviation and Airports Authority of India on the subject.

19. 20.6.2005 1-30 The Committee took up the examination of the functioning of Archaeological Survey of India and heard the views of the Secretary, Ministry of Culture and Director General, Archaeological Survey of India on the subject.

Secretary, Ministry of Culture and Director General, Archaeological Survey of India.

20. 29.6.2005 2-0 The Committee took-up further consideration of the 'Development of Airport Sector with special emphasis on new modern airports’ and heard the views of the representatives of the Ministry of Civil Aviation and Airports Authority of India on the subject.

Secretary, Ministry of Civil Aviation and Chairman, Airports Authority of India

21. 08.7.2005 0-50 The Committee heard the views of the Secretary, Department of Shipping on the Admiralty Bill 2005.

Secretary, Department of Shipping

22. 18.7.2005 1-40 The Committee heard the views of Shri Dipankar Halder, Company Secretary, Shipping Corporation of India; Capt. R.K. Sood, representative from the Foreign Owners Representative & Shipmanager Association; and Shri.V.K. Balakrishnan, Vice-President, Port, Dock & Waterfront Worker's Federation of India on the Admiralty Bill 2005.

Shri Dipankar Halder, Company Secretary, Shipping Corporation of India; Capt. R.K. Sood, representative from the Foreign Owners Representative & Shipmanager Association; and Shri.V.K. Balakrishnan, Vice-President, Port, Dock & Waterfront Worker's Federation of India.

23. 19.7.2005 0-40 The Committee heard the views of Shri P.M. Mohammed Haneef, General Secretary, All India Port & Dock Workers' Federation on the Admiralty Bill 2005.

Shri P.M. Mohammed Haneef, General Secretary, All India Port & Dock Workers' Federation.

24. 17.8.2005 0-50 The Committee considered the Status of Action Taken Replies on the recommendations contained in its 88th Report on the Demands for Grants (2005-06) relating to the Ministry of Civil Aviation. Thereafter, the Committee

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considered the draft report on the "'Development of Airport Sector with Special emphasis on new Modern Airports" and after some discussion adopted the report.

25. 31.8.2005 2-40 The Committee heard the views of Shri P.K. Samantray, President, Indian National Port & Dock Worker's Federation, Capt. K. Guha, Chairman, Foreign Owners Representatives & Shipmanagers Association, Shri Zarir P. Bharucha, Advocate, Supreme Court of India; Shri P. Krishnaiah, President, Port, Dock & Waterfront Worker's Federation of India, Shri P.S. Nagarsheth, President, Iron Steel Scrap & Shipbreakers Association of India on the Admiralty Bill 2005.

Shri P.K. Samantray, President, Indian National Port & Dock Worker's Federation, Capt. K. Guha, Chairman, Foreign Owners Representatives & Shipmanagers Asso-ciation, Shri Zarir P. Bharucha, Advocate, Supreme Court of India; Shri P. Krishnaiah, President, Port, Dock & Waterfront Worker's Federation of India, Shri P.S. Nagarsheth, President, Iron Steel Scrap & Shipbreakers Association of India.

26. 9.9.2005 2-15 The Committee met with the Swedish Parliamentary Committee on Culture Affairs.

Thereafter, the Committee heard the views of Shri G.S. Gill, Chairman of the Company of Master Mariners of India and Dr. Shanti G. Patel, President of the National Union of Seafarers of India on the Admiralty Bill 2005.

Shri G.S. Gill, Chairman of the Company of Master Mariners of India and Dr. Shanti G. Patel, President of the National Union of Seafarers of India

27. 19.9.2005 0-30 The Committee considered the draft 91st Report on the "Functioning of Archaeological Survey of India" and after some discussion adopted the report with minor modifications.

Thereafter, the Committee decided to take up the subject "Functioning and Performance of India Tourism Development Corporation (ITDC) for in-depth study and examination.

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28. 28.9.2005 2-45 The Committee met with the South African Parliamentary Standing Committee on Social Development and Community

Secretary, Department of Shipping

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Development.

Thereafter, the Committee heard the views of Secretary, Department of Shipping on the Admiralty Bill 2005.

29. 7.10.2005 2-15 The Committee heard the views of the Secretary, Ministry of Tourism on the Functioning and Performance of India Tourism Development Corporation (ITDC).

Secretary, Ministry of Tourism

30. 19.10.2005 2-15 The Committee heard the views of the Secretary, Ministry of Tourism on the Functioning and Performance of India Tourism Development Corporation (ITDC).

Secretary, Ministry of Tourism

31. 28.10.2005 1-15 The Committee discussed the Action Taken Replies furnished by the Department of Shipping on the 89th Report of the Committee on the Merchant (Shipping) Amendment Bill, 2004 and directed the Secretariat to examine the procedural formalities and also the precedents in this regard.

Thereafter the Committee decided to take up the subject - "Functioning of the National Highways Authority of India (NHAI)" for in-depth study and examination.

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32. 14.11.2005 2-15 The Committee heard the views of the Secretary, Department of Road, Transport and Highways on the functioning of National Highways Authority of India (NHAI).

Secretary, Department of Road, Transport and Highways

33. 27.12.2005 0-30 The Committee met for preliminary discussion on the Inland Vessels (Amendment) Bill 2005 and the Carriage by Road Bill, 2005. Thereafter, the Committee discussed its future programme.

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CHAPTER-XII

COMMITTEE ON HEALTH AND FAMILY WELFARE

I. COMPOSITION OF THE COMMITTEE

12. The Department-related Parliamentary Standing Committee on Health & Family Welfare was re-

constituted w.e.f. 5th August, 2005

12.2 The Committee consists of the following members:-

1. Shri Amar Singh Chairman

RAJYA SABHA

2. Shrimati Sukhbuns Kaur 3. Shri Yusuf Sarwar Khan alias Dilip Kumar 4. Prof. P.J. Kurian 5. Dr. A.K. Patel 6. Shrimati Maya Singh 7. Dr. M.A.M. Ramaswamy 8. Shri R. Sarath Kumar 9. Shri Lalhming Liana

*10. Shri Digvijay Singh

LOK SABHA 11. Shri D.K. Adikesavulu 12. Shri M. Ambareesh 13. Smt. B. Sushila Devi Laxman 14. Dr. Babu Rao Mediyam 15. Dr. Ram Chandra Dome 16. Smt. Maneka Gandhi 17. Smt. Bhavana Pundlikrao Gawali 18. Shri S. Mallikarjunaiah 19. Dr. Chinta Mohan 20. Shri Rasheed Masood 21. Smt. Archana Nayak 22. Shri D.B. Patil 23. Shri Nakul Das Rai 24. Shri Rajendra Kumar 25. Smt. K. Rani 26. Dr. Mohd. Shahabuddin 27. Dr. Arvind Kumar Sharma 28. Shri Uday Singh 29. Smt. V. Radhika Selvi 30. Shri Kailash Nath Yadav 31. Dr. Karan Singh Yadav

* Nominated w.e.f. 13th of December, 2005

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II. Subject selected for Examination

12.3 The Committee on Health & Family Welfare did not select any subject for examination in 2005.

12.4 The following five Bills were referred to this Committee for examination and report during 2005: -

1. The Homoeopathy Central Council (Amendment) Bill-2005 2. The Indian Medicine Central Council (Amendment) Bill-2005 3. The Drugs and Cosmetics (Amendment) Bill-2005 4. The Indian Medicine and Homoeopathy Pharmacy Bill- 2005 5. The Indian Medical Council (Amendment) Bill-2005 The reports on the Homoeopathy Central Council (Amendment) Bill-2005 and the Indian Medicine

Central Council (Amendment) Bill-2005 were presented to both the Houses of Parliament on 29th July, 2005.The report on the Drugs and Cosmetics (Amendment) Bill-2005 was presented to both the Houses of Parliament on 21st December, 2005.

III. Constitution of Sub-Committees of the Department-related Parliamentary Standing Committee on

Health & Family Welfare

12.5 No Sub-Committee was constituted during the year 2005.

IV. Review of Work Done

(a) Sittings of the Committee

12.6 During the year, 2005, the Committee held in all, 16 meetings lasting over 32 hours 05 minutes. A statement showing the dates and duration of each sitting of the Committee with subjects discussed during this period are given in Annexure-XIII (b) Sitting of the Sub-Committee 12.7 No Sub-Committee was constituted during the year 2005.

(c) Study visits: -The Committee did not undertake any study visit/tours during the year 2005.

12.8 No study group was constituted to make on-the-spot study of local offices, institutions, projects etc. on the subjects under examination.

12.9 Verbatim record of proceedings of the meetings of the Committee, was kept.

V. Reports Presented

(a) Reports

12.10 During 2005, the Committee presented the following Reports to both the Houses of Parliament: -

Sl. NO. Reports No. and date of presentation/ laying of Reports

Reports

1. 4th

10.03.2005

Report on action taken by the Department of Health on the Recommendations/observations contained in the First Report of the Committee on Demands-for-Grants (2004-2005) of the Department of Health.

2. 5th

10.03.2005

Report on action taken by the Department of Family Welfare on the Recommendations/observations contained in the Second Report of the Committee on Demands-for-Grants (2004-2005) of the Department of Family Welfare.

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3. 6th

10.03.2005

Report on action taken by the Department of AYUSH on the Recommendations/observations contained in the Third Report of the Committee on Demands-for-Grants (2004-2005) of the Department of AYUSH.

4. 7th

27.4.2005 (L.S)

28.4.2005 (R.S)

Report on Demands-for-Grants (2005-06) of Department of Health (Ministry of Health and Family Welfare)

5. 8th

27.4.2005 (L.S)

28.4.2005 (R.S)

Report on Demands-for-Grants (2005-06) of Department of Family Welfare (Ministry of Health and Family Welfare)

6. 9th

27.4.2005 (L.S)

28.4.2005 (R.S)

Report on Demands-for-Grants (2005-06) of Department of AYUSH (Ministry of Health and Family Welfare)

7. 10th

29.07.2005

Report on the Homeopathy Central Council (Amendment) Bill-2005

8. 11th

29.07.2005

Report on the Indian Medicine Central Council (Amendment) Bill-2005

9. 12th

21.12.2005

Report on the Drugs and Cosmetics (Amendment) Bill-2005

10. 13th

21.12.2005

Report on action taken by the Department of Family Welfare on the Recommendations/observations contained in the Eighth Report of the Committee on Demands-for-Grants (2005-2006) of the Department of Family Welfare.

11. 14th

21.12.2005

Report on action taken by the Department of AYUSH on the Recommendations/observations contained in the Ninth Report of the Committee on Demands-for-Grants (2005-2006) of the Department of AYUSH.

12. 15th

21.12.2005

Report on action taken by the Department of Health on the Recommendations/observations contained in the Seventh Report of the Committee on Demands-for-Grants (2005-2006) of the Department of Health.

12.11 Minutes of the meetings of the Department-related Parliamentary standing Committee on Health and Family Welfare were prepared and enclosed with the reports presented to the House. VI. Summary of recommendations (a) 4th Report 12.12 The Committee noted that with an additional grant of Rs. 408 crores in the form of Supplementary Grants for 2004-05, the gap in the requirement and allocation of funds for some major programmes had been bridged to some extent. However, a shortfall of Rs. 339.50 crores was still left from the proposed outlay of Rs. 2547.50 crores. The Committee felt that this shortfall would adversely affect the targets set by the Department. The Committee was of the view that such important programmes of public health should be allocated sufficient funds to face the challenges in health care system. Further the submission of the Department that even after this additional allocation, there was a disproportionately high balance of Rs. 4944 crores for the remaining two years of the 10th plan, was worth considering and needed serious attention of the Government. The Committee, therefore, reiterated its recommendation for allocation of adequate funds to the Department for the remaining two years of the 10th plan. 12.13 Even after including the reported additional expenditure incurred by the Ministry of Urban Development the total fund utilization during the IXth plan was Rs. 4997.73 crores and under-utilization was

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Rs. 120.46 crores, which is not a meager sum. It needed a serious thought on the part of the Department and especially when various cuts were imposed by the Finance Ministry. The Committee was of the view that the Department should not leave the balance unspent and use it judiciously in a time-bound manner. 12.14 While advocating higher allocation of funds for the vital sector of health, the Committee viewed with serious concern the Department's inability to fully utilise the allocated funds. The Committee felt that only constant monitoring of implementation of various programmes in active co-ordination with the implementing agencies at state as well as district level would result in optimum and judicious utilization of allocated funds. Making concerned officials apprised of Committee’s views would not achieve any results. 12.15 The Committee expressed its deep sense of concern over the undue delay in the issuing of notification on the drugs formulary. The Committee’s observation on this issue did not seem to have made any significant impact. Process of fixation of rates of formulary still remained to be completed. The Committee reiterated that the Departments should get completed this process without any further delay.

12.16 The Committee had been commenting on the need for restoring the double shift system for the CGHS dispensaries prevalent some years ago. The Committee had observed that the Department was not inclined to revert back to the earlier system and had been advancing unconvincing reasons therefor. The Committee pointed out that under the double shift system also, working hours would remain the same. If the CGHS employees residing nearest to a particular dispensary were posted there, to the extent possible, chances of undue hardship to the CGHS employees would also stand eliminated. In this way, CGHS beneficiaries would be in a position to obtain the maximum benefit of medical facilities available at CGHS dispensaries, the purpose for which they had been set up. 12.17 The Committee observed that the Department's efforts to expand the services available at Safderjung Hospital had so far not yielded any result. Chances of augmentation of health services at the hospital in the near future seemed to be very dim. The Committee impressed upon the Department to formulate a comprehensive Re-development Plan at the earliest and implement the same with a set target.

12.18 The Committee was constrained to note that first batch of students for MBBS in V.M.M.C were admitted for academic session 2001-2002 and till recent times neither the building had been completed nor the full faculty members were in place. Inspection for grant of recognition of degree by MCI was due in March,2006. Reply of the Department gave the impression that likelihood of availability of required infrastructure and sanctioned faculty strength would be possible only by March, 2006. The Committee observed that by that time first batch of MBBS students would be on the verge of completion of their course. With less than half the teaching faculty and in the absence of proper building and essential infrastructure, quality of education imparted to these students could well be imagined. The Committee also felt that one cannot be sure whether the MCI after inspection would grant recognition of the degree to be provided to the students of VMMC. The Committee therefore was of the opinion that keeping in view the future of large number of students already admitted, urgent necessary steps might be taken to make VMMC fully functional in all respects. 12.19 The Committee observed that not much progress had been made in the establishment of Trauma Center at AIIMS. Procedural formalities were yet to be completed. An amount of Rs. 17.65 crores proposed to be utilized for the construction of Trauma Center in 2004-05 would thus remain unutilized at the end of the year. The Committee reiterated that the Department should get all the procedural formalities completed at the earliest so that construction of this over- delayed Center finally began in 2005-06. Otherwise, the estimated cost of the Project would keep on increasing and the public would also continue to remain deprived of the medical facilities to be made available at the Trauma Center. 12.20 The Committee had taken a serious view of very tardy progress in the completion of the B.R. Ambedkar Institute of Rotary Cancer Hospital to be established at AIIMS. The Committee, found that the Project continued to remain entangled in procedural formalities as the approval of revised EFC proposal was yet to be taken. The Committee once again emphasized that required steps might be taken so that the Institute became fully functional without any further delay. 12.21 Last year, the Committee had commented on the adverse impact of existence of a large number of vacancies of medical and Para-medical Staff in the Central Govt. hospitals on the public health services. The Committee observed that as suggested by it, the Department had taken up the issue of seeking exemption of technical/Scientific posts from the purview of Department of Personnel and Training instructions dated

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16.05.2001. The Committee hoped that this measure would lead to induction of required technical manpower. The Committee was, however, constrained to note that some vacancies including CHC posts, although cleared by the Steering Committee were yet to be filled up by the Lady Hardinge Medical College and Smt. S.K. Hospital, New Delhi and JIPMER, Pondicherry and also CHS Division. The Committee was not aware about the action, if any, taken by the concerned authorities in this matter. The Committee reiterated that existing vacancies against sanctioned posts duly cleared by the Screening Committee should be filled up on priority basis. 12.22 The Committee’s attention had been drawn by the high incidence of malaria deaths in the country. The Committee had observed that overall national figures of death cases continue to be high, with Orissa and W. Bengal reporting the maximum cases as per the figures pertaining to the period 1999-2003. The Committee had been given to understand that both these states were being provided additional financial assistance for malaria control. The most affected districts had been included for additional support under the Global Fund for AIDS, TB and Malaria. The Committee reiterated that the Department should carry out an assessment of the weak areas and identity the constraints/ problems faced by the implementing agencies in malaria control. The Committee also emphasised that random surveys/surprise inspections needed to be made by Central/State level teams. 12.23 The Committee expressed its dissatisfaction with the casual response of the Department to its specific recommendation for providing cash grants to highly endemic States for IEC activities. The Committee found that no initiative had been taken by the Department to its suggestion for making a provision at the RE stage in 2003-04. The Department had chosen not to react to Committee’s emphasis on having an assessment done of highly endemic districts for taking preventive measures to avoid recurrence of outbreaks of cases of JE in Andhra Pradesh and U.P. Reiterating its observation, the Committee hoped that the Department would act on its suggestion.

12.24 The Committee observed that the trend of under-utilisation of allocated funds for the National Programme for Control of Blindness in N-E states during Ninth Plan continued to be there in the first two years of the Tenth Plan. Unspent balances lying with the District Blindness Committees due to one reason or other indicated their inability to utilise the allocated funds during the prescribed period. Rigid procedural formalities and non-compliance of accounting procedure may be responsible for such a situation. The Committee recommended that remedial measures should be taken at the earliest, once the problem areas in the implementation of this programme were identified.

12.25 The Committee was of the view that in order to utilise the approved outlay of Rs. 190/- crores to implement the National Mental Health Programme during the Tenth Plan, necessary steps might be taken urgently on priority basis to identify the districts so as to increase the coverage to 100 districts as planned. The Committee was of the opinion that unless the districts were identified urgently the utilization of funds might not be achieved during the Tenth Plan.

12.26 In order to utilise the allocated funds for the National Cancer Control Programme, the Committee felt that the existing Regional Cancer Centres which were seeking necessary infrastructure and equipment should also be provided with such equipment on priority basis so that they might function properly.

12.27 The Committee felt that the Department should not do injustice to the scheme by discontinuing it for want of adequate funds to cater to the prevailing demands from various Govt. Medical Colleges and hospitals The Committee felt that a suitable procedure in allocating the available resources in a just, equitable and judicious manner might be devised. The recommendation of the Committee that the Department should initiate an exercise of assessing the needs/status of infrastructure available at Govt. Medical Colleges and hospitals and start with providing relief to those intuitions which are in a very bad shape, had not been taken in right perspective. The Committee therefore recommended that the Scheme of Strengthening of Diagnostic facilities in selected Government Medical Colleges and Hospitals should be revived from the ensuing financial year 2005-2006 and the available resources might be provided to those institutions which were in a very bad shape and deficient in diagnostic facilities after assessing their requirements and status.

12.28 The Committee had made the above recommendation hoping that the Department would approach the concerned Ministry in the Govt. i.e. the Ministry of Statistics and Programme Implementation so that necessary changes in the guidelines to spend the MPLAD funds were placed before the respective Parliamentary Committees on MPLAD in Rajya Sabha and Lok Sabha. However, the Department had done nothing in this regard. The Committee, therefore, recommended that the Department should take suitable action in this regard.

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(b) 5th Report 12.29 The Committee viewed with serious concern the achievement level with regard to setting-up of Sub-Centers as per 1991 census. The Committee noted that shortfall of 8669 Sub-Centers was targeted to be fulfilled by the Planning Commission with annual target of 1941 for each of the years 2003-2004 and 2004-2005, second and third year of Tenth Plan. The Committee had been given to understand that approval of Cabinet for opening of 8669 Sub-Centers was obtained in January,2004 and funds for establishing the new Sub-Centers @ Rs.10,000/- each were duly released in February,2004. The Committee felt that no further information about the progress made in actual establishment of new Sub-Centers since February, 2004 is available with the Department. The Committee emphasized that the responsibility of the Department does not end with regular reminders to the State Govts. The Department should make all conceivable efforts for getting the required Sub-Centers set up as per 1991 census. Progress being made specially in the major defaulter States should be constantly monitored by the Department. Preparatory exercise for fulfilling the gap of 26,478 Sub-Centers as per the 2001 census should start from 2005-2006 itself. 12.30 The Committee had been given to understand that in spite of there being shortfall in the number of required PHCs/CHCs in different parts of the country, possibility of any Sub-Center being not linked to any existing PHC/CHC was not there. The Committee was, however, not inclined to accept this assessment. As per the norms prescribed by the Department, each PHC acts as a referral unit for six Sub-Centers. Similarly, each CHC serves as a referral unit for four PHCs. As per the information available with the Committee, these norms were not being adhered to, by many States. While some of the States were having excess number of these Centers, in some States there was acute shortage. Both the situations could not be considered satisfactory. Position in the following States were self-explanatory: -

States having excess Sub-Centers As per 1991 census

State

Sub-Centre PHC CHC

R P S R P S R P S Assam

4356 5109

excess centers

726 610 116

18 100 81

610 PHCs are serving 5109 Sub-Centers whereas as per norms, only 3660 Sub-Centers should be linked with 610 PHCs. Similarly 100 CHCs should be serving only 400 PHCs

State

Sub-Centre PHC CHC

R P S R P S R P S Andhra Pradesh

10242 10568

excess centers

1707 1386 321

427 219 208

1386 PHCs are serving 10568 Sub-Centers whereas, as per norms, only 8316 Sub-Centers should be linked with 1386 PHCs. Similarly, 219 CHCs should be serving only 876 PHCs. The Committee was constrained to observe that the position was worse in States where shortfall was there in the required number of all the three categories of Centers. The Committee drew the attention of the Department towards the following States:-

State

Sub-Centre PHC CHC

R P S R P S R P S Bihar West Begal

11547 10356

10337 8126

1210 2230

1961 1726

1648 1262

313 464

490 431

101 99

389

332

The number of CHCs in position in Bihar and West Bengal as indicated above was nowhere near the prescribed norms. Position was also bad in respect of ratio of Sub-Centers and PHCs. The Committee would like to point out that effective linkage between a Sub-Center and PHC/ CHC at the ground level so that

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beneficiaries were in a position to avail of services offered at all these Centers was required to be there in all the States, specially in those states not performing well. The Committee, therefore, recommended that the Department should monitor the setting up of required Sub-Centers/PHCs/CHCs as per 1991 census during the Tenth plan period. The Committee agreed with the views of the Department that mere absence of Govt. building may not affect the routine functioning of PHC/CHC. The Committee, however, apprehended that condition of PHC/CHC buildings whether Govt. or rented, might not be generally satisfactory. Infrastructure status might also be equally bad. The Committee pointed out that as per the information available with it as on 31.03.03, out of 22,926 functional PHCs only 13,938 PHCs are in Govt. buildings 4153 are in rented/rent- free Panchayat buildings. As many as 1815 PHC buildings were under construction and 3755 buildings were yet to be constructed. Similarly, out of 3106 functional CHCs, 2367 CHCs were in Govt. building, 414 were in rented/rent free buildings, 254 buildings were under construction and 241 were yet to be constructed. The Committee would appreciate if a sample survey about the status of functional Sub-Centers, PHCs and CHCs in some selected states - both good and bad performing ones, was conducted under the supervision of the Department and corrective steps taken thereafter. 12.31 The Committee has noted that the total sanctioned posts of ANMs were 1, 48,668 in the country, out of which 1981 posts were lying vacant. Situation was particularly bad in Bihar, J&K, Madhya Pradesh Tripura, and Uttar Pradesh & Pondicherry. Similarly in respect of LHVs, out of the total sanctioned posts of 24331, 3315 posts were lying vacant. The defaulting States were Gujarat, Haryana, Kerala, Madhya Pradesh Mizoram, Punjab, Sikkim, and Utter Pradesh. The Committee also observed that information given by the Department was as on 31.03.2003. The Committee found it surprising that in the present IT dominated scenario the Department was relying on figures about two years old. Not only this, specific information about new states like Jharkhand, Chattisgarh and Uttaranchal were not available with the Department. In view of the fact that the salary of ANMs and LHVs were borne by the Central Government, Committee failed to understand as to why some State Governments had failed to fill up the vacant posts of ANMs and LHVs. The Committee, therefore recommended that the Department should impress upon these states to fill up the vacancies in respect of ANMs/LHVs expeditiously. The Committee further noted that out of 82,966 posts of MPW (Male), 14948 were lying vacant. The states where 10% or more posts were lying vacant, were Andhra Pradesh, Assam, Goa, Gujarat, Haryana, Himachal Pradesh Karnataka, Maharashtra, Orissa, Punjab, Rajasthan, Tamil Nadu, Uttaranchal, Uttar Pradesh and West Bengal. The long list of states as mentioned above shows that most of the states in our country had defaulted in appointing the required number of MPWs (Male). The Committee felt that the MPW (Male) was a very important health functionary at the village level. He not only educated the men folk about their general and reproductive health, but also made them aware about benefits of small family and various methods to keep the family small. The Committee, noted that some states had requested the Govt. to fund the salary of MPW (Male). The Committee emphasized that the Department should take a decision in this regard at the earliest. 12.32 The Committee notes that under the scheme of “Strengthening of Basic Training Schools”, Rs. 213.13 lakhs have been released to 16 ANM/LHV Training schools located in Uttaranchal, Chattisgarh, Rajasthan and Sikkim during 2003-2004. While appreciating the initiative taken by the Department for repair/ strengthening of ANM/LHV Training Schools, the Committee reiterated that a time-bound action plan should be formulated and implemented as only about 22% ANM/MPW(F) Training Center buildings were in good condition and 42.5% buildings required major repairs. Status of LHV and MPW (M) Training Centers was also similar. In view of majority of ANM/MPW (F) Training Centers and all LHV Training Centers being funded by the Department, the Committee felt that the Department should monitor at all levels the work of strengthening of these Training Centers.

12.33 The Committee noted that the amount of unspent balances under Reproductive and Child Health Programme lying with different State Govts. had come down from Rs. 912.80 crores to Rs. 809.26 crores as a result of some initiative taken by the Department during the last year. But the fact remained that level of unspent balances remained too high. The Committee was not inclined to accept the justification, namely, inability of State Govts. to provide actual expenditure due to non-receipt of reports from the interior districts for consolidation, advanced by the Department. The Committee strongly felt that there was an urgent need for streamlining the entire procedure of disbursal of Funds and accounting thereof. The Committee understood that Programme Officers of the Department had been assigned the state-wise duties to carry out routine monitoring and surprise inspections. The issue of unspent balances and the factors responsible therefore and remedial steps taken/ to be taken should be an essential part of the reports submitted by these Programme Officers.

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12.34 The Committee’s attention had been drawn towards a number of initiatives taken by the Department for making the implementation of RCH effective. The Committee had asked for specific details about the achievement made by State Govts. in this regard. As per the details made available to the Committee, the Department did not have any record about the level of physical achievements of the schemes as made by States/UT of Bihar, Jharkhand, Uttaranchal and Andman & Nicobar Islands under the following schemes-:

(a) Contractual Appointment of Additional ANMs

(b) Contractual Appointment of Public Health/Staff Nurses

(c) Contractual Appointment of Lab Technicians.

The Committee also noted that under the schemes of ‘Hiring of Safe Motherhood Consultants at PHCs/CHCs’ and ‘Hiring of Private Anesthetists’, the Department was not aware about the utilization position of allocated funds by a number of states. The Committee strongly felt that mere holding of national workshops on the national health schemes under RCH and state visits by the Department officials would not serve the purpose. The Committee reiterated that there was a need for having an effective monitoring mechanism where under both regular and surprise inspections were conducted by the Central teams in co-ordination with state authorities followed by corrective steps. (c) 6th Report 12.35 The Committee had been observing that new schemes continued to be launched and funds, sometimes substantial and sometimes token, continued to be earmarked for years. Lack of preparatory exercise and non-assessment of feasibility aspect were the main factors responsible for such a situation. Scheme of Ayurvedic Park/Panchkarma in hotels was one such example. This scheme was started during Ninth Plan, apparently without consulting the Ministry of Tourism. Token provision made for this scheme needed to be stopped in 2005-2006 - fourth year of the Tenth Plan. The Committee reiterated that any new scheme needed to be started only after proper groundwork therefor was completed. 12.36 The Committee had been given to understand that the Department would be in a position to utilise more funds than provided in the Tenth Plan. The Committee would, however, like to point out that the Tenth Plan allocation of Rs. 775.00 crores was almost the double of Ninth Plan allocation of Rs. 364.43 crores. Seeing the trend of utilization of funds during the Ninth Plan and also the first two years of the Tenth Plan, the Committee felt that chances of utilization of more funds than provided for the Tenth Plan seemed unlikely. The Committee, therefore, observed that the Department should take the required steps for the optimum and judicious utilization of funds. The Committee understood that mid-term appraisal of the ongoing schemes in consultation with the Planning Commission had been initiated by the Department. The Committee emphasized that less important schemes might not be allowed to continue for long and appropriate decision for their discontinuance / merger with other schemes might be taken. 12.37 The Committee expressed its serious concern over the undue delay in enacting a law for establishing a Central Pharmacy Council of Indian Medicine and Homoeopathy. The Committee observed that no progress seemed to have been made in this regard during 2004-05 also. The Committee strongly felt that such a Council needed to be set up at the earliest for regulating Pharmacy education and practices under the Indian systems of Medicine and Homoeopathy. The Committee was of the view that any further delay would have an adverse impact on the growing popularity of Indian systems of Medicine, especially on Ayurveda. 12.38 Ayurveda Hospital, Lodhi Road, New Delhi was handed over by the CGHS to the Department of AYUSH in August, 2002. The Committee, however, apprehended that this might not have resulted in better management as hospital administration and accounts except transfer and posting of Physicians still remains with the CGHS. The Committee failed to understand the rationale behind putting the Ayurveda Hospital under the dual control of the Department of AYUSH and CGHS. The Committee recommended that the Hospital should be placed under the full control of the Department at the earliest. The Committee found that the Hospital still continued to be run without there being a regular Medical Superintendent and half the sanctioned posts laying vacant. The Committee was not inclined to accept the contention of the Department that the hospital was operating optimally despite scarcity of Para-medical and lower level staff. The Committee recommended that the Department should expedite the exercise of filling up of all the vacancies in the hospital. Stop-gap arrangement of utilizing the services of staff from the Research Council and the National Institute of Yoga could not be considered as a healthy trend as this was bound to have an adverse effect on the functioning of the Research Council and the National Institute of yoga.

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12.39 The Committee was constrained to observe that the expansion of AYUSH Dispensaries in CGHS, a new scheme proposed during the Ninth Plan, continued to remain on paper although the Tenth Plan has also reached its mid-term. The Committee found that no progress seemed to have been made in starting the two Ayurveda, two Homoeopathy, one Unani and one Siddha Dispensary and one Yoga Centre in the premises of existing Allopathic dispensaries at Trivandrum, Guwahati and Delhi. The Committee strongly felt that the Department should expedite the process of making the new dispensaries functional by making an assessment of the delaying factors and getting them removed at the highest level. The Committee observed that the reply of the Department did not give much hope about the filling up of the required posts for these dispensaries during 2004-05 also. The Committee was well aware that the procedure of recruitment through UPSC and revival of posts was complicated and time taking. Nevertheless, viable remedial steps were required to be taken by the Department. 12.40 The Committee noted the efforts made by the Department in the setting up of the All India Institute of Ayurveda in Delhi during 2004-2005. The Committee, however, observed that formal allotment of additional 6.5 acres of land from the DDA was still at the processing stage. The Committee apprehended that if things were further delayed due to procedural formalities, estimated cost of the hospital project would continue to be revised and in the process becoming costlier. The Committee, therefore, recommended that the Department should pursue the matter with all the concerned agencies and make the hospital functional at the earliest. 12.41 The Committee expressed its serious concern over the undue delay in making the Medicinal Plant Board fully functional. The process of setting up the Board started in 1999-2000 and the year 2004-05 was nearing its end but the progress made so far, was approval of the Department of Expenditure for creation/outsourcing of only 6 posts including CEO for the Board. The Committee was not aware whether these posts had been filled up. The proposal for creation of 31 other posts was under consideration. The Committee expressed its dissatisfaction on the pace of progress due to prolonged procedural formalities to be completed. The Committee, therefore, was of the view that the Department should pursue this matter vigorously so that the Medicinal Plant Board becomes fully functional. 12.42 The Committee reiterated its serious concern about the easy availability of fake and spurious drugs of ISMH, particularly Ayurveda in the country. The Committee was not satisfied with the initiative taken by the Secretary (AYUSH) in calling a meeting of State Drug Controllers and Licensing Authorities and State Secretaries in which all aspects of quality control, enforcement concerning ISMH drugs were discussed and necessary advisories given. The Committee strongly felt that the Department had to take corrective action in the instances of spurious/fake ISMH drugs being sold in any part of the country, coming to its notice through media or otherwise.

(d) 7th Report

12.43 The Committee observed that in accordance with the goals as contained in the National Health Policy 2002, allocation for central health sector should imply a manifold increase in the budget requirement. The Committee was in agreement with the contention of the Department that past trends of allocation of budgetary outlays and the overall resource constraint did not indicate a very encouraging scenario. Two suggestions were put forth before the Committee in this regard by the Department. First was that the external assistance for different schemes being obtained from various agencies as grants be taken as an additionally over and above the budget. Committee was given to understand that a major constraint of National AIDS Control Programme had been that of external assistance which came through Gross Budgetary Support as a result of which all external assistance had to be accommodated within the Annual Plan/ Five year plan outlay ceiling. The Committee was in agreement with the viewpoint of the Department that external assistance coming in the shape of grant-in-aid (distinct from loan) should flow over and above the Gross Budgetary Support. The Committee, accordingly, recommended that the Department should take up this issue with the Planning Commission. 12.44 The Committee, however, had serious reservations on this proposal, not only due to such a cess involving taxpayer’s money but also due to the past record of utilization of funds by the Department. While not denying that approved outlay for 2005-06 will adversely affect a number of schemes, the most affected being the ambitious ‘Pradhan Mantri Swasthya Suraksha Yojana’ the Committee was more perturbed by the trend of allocation of non-plan funds. Non-provision of required non-plan funds for premier hospitals like AIIMS, PGIMER, Chandigarh, NIMHANS, and Bangalore, even affecting the salary component of the staff was a matter of serious concern.

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12.45 The Committee was dismayed to note that as a result of declining trend of allocation of non-plan funds, Department was compelled to divert plan funds to non-plan to meet the obligations of some major health institutions. The Committee felt that this cannot be considered a healthy development, being against the prescribed norms. Diversion of Plan funds to non-plan side very well indicates the poor status of schemes of the Department, very vital for the development of the country as a whole. While on one side Department was advocating imposition of 2% cess for generation of additional funds, it was not in a position to utilize the allocated plan funds due to poor management and incapacity of implementing agencies. The Committee would like to emphasize that the Department should take remedial measures in the light of findings of mid-term appraisal of various schemes. 12.46 The Committee hoped that enhanced funds amounting to Rs. 26 crores for 2005-06 will be fully utilized for the proposed expansion plan for the CGHS. 12.47 The Committee reiterated that the Department should expedite the notification of over-delayed drugs formulary without any further delay. 12.48 While appreciating the release of additional funds for the purpose, the Committee was of the view that there was a need for streamlining the system so that required funds were available in time for clearing the anticipated bills of authorized local chemists. The Committee also mentioned that a review of the existing system of procuring of specialist prescribed medicines should be made so as to remove the bottlenecks/ constraints, if any. 12.49 The Committee was not fully convinced by the Departments, projection of need for such a large number of posts. The Committee pointed out that there had been gradual increase in the number of allopathic dispensaries. Earlier also CGHS dispensaries were working in double shift. The Committee had asked for the details about the number of dispensaries working in double shift and the staff in position in such dispensaries and the present sanctioned strength and in position. The Committee felt that the present working hours could be easily divided into two shifts as per the earlier practice. The Committee failed to understand the rationale for projection of the requirement at such a high scale. The Committee, therefore, emphasized that the Department should get a review done based on the practical requirement on the analogy of earlier double shift system. 12.50 The Committee understood that at present a CBI inquiry was going on a complaint received with regard to recognition/reimbursement of hospitals bills. The Committee was of the view that review of the existing system of this specific facility available to the CGHS beneficiaries should be carried out in the light of the findings of ongoing CBI inquiry. 12.51 The Committee was unhappy to note that the CGHS network had not been able to achieve its desired objective of providing efficient medical service to its beneficiaries. The Network of CGHS dispensaries had degenerated to a stage where patients receive neither treatment nor consultation. In fact, beneficiaries with very basic ailments only such as cold and cough were attended to in these dispensaries. In Committee’s view, the position today was that treatment of the beneficiaries was practically taking place at the specialist level only in a few hospitals and in designated dispensaries in Delhi, and the number of specialists available in Delhi vis-a vis CGHS beneficiaries was very low. Position of CGHS beneficiaries residing in NCR such as Noida, Gurgaon was worse as they were given dates of visit by specialists, sometimes ranging from 45 days to 60 days and the beneficiaries have to wait for the arrival of specialists for long periods. Therefore, the idea of providing a convenient health care to the Central Government employees has remained a dream. The Committee strongly recommended that Government should take immediate steps to ensure that CGHS dispensaries, function in such a manner that the dispensaries, instead of being a place for referring patients to specialists and disbursement of medicines recommended by them, should become health centres where its beneficiaries actually receive proper treatment. It was considered high time that the role and function of CGHS dispensaries is re-determined. 12.52 The Committee strongly recommended that the Government should take stock of the dispensaries which had not been housed properly so that they move into preferably their own building or at least into some bigger accommodation for the time being in the interest of the doctors/staff and the patients. To start with at least those buildings for which land had been acquired / allotted could be constructed on priority basis.

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12.53 The Committee failed to understand the constraints being faced in procuring these equipment for which contracts had been signed and funds were also available. The Committee strongly felt that there was urgent need for review of entire procurement process so as to eliminate the bottlenecks being faced. 12.54 The Committee, however, was not happy with the existing system of getting NOC from the Fire Department. Although more than six months had lapsed after completion of the OPD building, it remained inoperational for want of requisite clearance from the Fire Department. The Committee strongly felt that the present guidelines /norms of Fire Department needed to be reassessed in the present scenario.

12.55 The Committee hoped that construction of the VMMC building would be completed within the time-schedule, thereby eliminating any increase in the original estimate of expenditure. 12.56 The Committee recommended that the Department should be making serious efforts to get the vacant posts filled up at the earliest. The Committee emphasized that the Department should get the construction of VMMC expedited and fulfills the prescribed norms for teaching and non-teaching faculty and the required infrastructure before the inspection by MCI in March, 2006. 12.57 The Committee was happy to note that the hospital possessed the basic infrastructure, faculty, clinical materials and the environment required for setting up the Institute. The Committee, however, emphasized that the Department should monitor the construction of the Institute Building in co-ordination with the hospitals authorities and the construction agency, to ensure the completion of this project within the prescribed time-limit. 12.58 The Committee was of the view that efforts should be made to expedite the completion of all the sanctioned projects within the prescribed time-frame. The Committee hoped that project appraisals and approval exercise for the remaining planned projects for the Tenth Plan must have started, if not, action should be initiated at the earliest. 12.59 The Committee expressed its serious concern over diversion of funds from plan to non-plan side. What was more disturbing was that actual expenditure during 2004-05 was only Rs. 86 crores, with allocated funds amounting to Rs. 65 crores remaining unutilized. The reason citied for these savings was that revised proposals for Trauma Center and Dr. B.R. Ambedker Institute of Rotary Cancer Hospital were yet to be approved by the competent authority. The Committee found that not much progress seemed to have been made in the Trauma Center project. The project was initially approved for Rs. 54.14 crores. However, due to change in the scope of work and additional statutory requirements, revised EFC for Rs. 177.82 crores was submitted on 11th December, 2003. Since then, the revised proposal is under the process of being placed before the CCEA. The Committee had been given to understand that comments of all appraisal agencies Ministry of Finance, Planning Commission etc. had been obtained on the draft cabinet note and were in the process of finalization. The Committee noted that the date of completion of the Trauma Center will be six months from the date of approval of CCEA. The Committee apprehended that there would be further cost escalation if the project failed to get the final clearance without any further delay. 12.60 The Commission expressed its serious concern over the very tardy progress made in the completion of two very important projects meant for saving precious human lives in the premier Institute of the country. The Committee strongly felt that there was an urgent need for streamlining the procedure for grant of formal approval to the proposed projects. Project Proposals keep on moving from one stage to another from one authority to another with the initial estimated cost increasing manifold. What was more disturbing was that procedural formalities did not end with the project getting final approval from the competent authority. Once the construction started, another set of concerned agencies took over. The Committee, therefore, strongly recommended that the Department should review the present system and take steps for removal of all unnecessary/ repetitive/ formalities arising in the operationlisation of a proposed project. 12.61 The Committee, therefore, recommended that the Department should initiate all required steps to get expedited the clearance of the project “Pradhan Mantri Swasthaya Suraksha Yojana”. 12.62 The Committee observed that availability of funds in the last two years of the Tenth Plan for all the above-mentioned Institutes/Hospitals clearly indicated that enhanced allocation of funds had failed to achieve the desired purpose. Trend of under utilization of funds continued to be there. This led to only one conclusion that due to lack of planning and constraints the institutes/hospitals had failed to take benefit from

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the enhanced funds. It also indicated absence of any dialogue/interaction and co-ordination mechanism for utilisation of allocated funds between the Department and the individual institutes.

12.63 The Committee was not convinced by these arguments as there was no shortage of funds during the Ninth Plan. Real reason must have been delay in the finalisation of technical specifications by the Technical Committee, as indicated by the Department itself. Similarly, for JIPMER, Pondicherry, a premier Institute in the country, two projects of Super Speciality Block and Trauma Care Centre and also considerable increase in the faculty strength are proposed.

The Committee took a serious view of this and wanted to be apprised about the factors responsible therefor. The Committee emphasized that the Department should initiate corrective measures in order to prevent such situations in future.

12.64 The Committee was however, constrained to note that at the end of first three years of the Tenth Plan, Rs. 520.00 crores remained to be spent. The Committee felt that this was not a healthy trend. In view of the mandate given to this apex body, there should be optimum and judicious utilization allocated funds within the prescribed time-frame. The Committee therefore enjoined upon the Department to take remedial steps including completion of procedural formalities at the earliest. 12.65 The Committee was happy to note that some companies like Lupin had shown interest in the Vijaysar product and ICMR was in the process of transfer of technology. 12.66 The Committee noted that the guidelines suggested that a multi-disciplinary National Apex Committee should be constituted to monitor Stem Cell research activities in the country. All proposals involving stem cells of any source would be examined by this Committee Centres involved in Stem Cell research would have to be registered with the Committee. While appreciating the initiative taken by the Council for regulation of Stem Cell research and its application, the Committee emphasized that the approval process of draft guidelines on the subject pending before DCGI should be expedited. This was very necessary in view of a number of clinics claiming successful results in the treatment of hitherto incurable diseases have started operation in recent years. The Committee felt that it would also be appreciative if an initiative was taken by the ICMR/Department/concerned authorities in taking preventive steps so that such clinics do not continue to attract patients. 12.67 The Committee expressed its serious concern about the status of medical/para-medical/technical/general staff in Safdarjung, Dr. RML Hospital, LHMC and Associated hospitals in Delhi. All these hospitals provide medical services, both routine and emergency to ever-increasing number of patients not only from Delhi and NCR but also from adjoining states. The Committee felt that with such a large number of vacancies, specially of medical posts, nursing posts and technical posts, these hospitals could never be in a position to provide the required services. The Committee was more worried about the situation in Safdarjung Hospital where some posts have simply lapsed. In some cases, status of the posts was not even confirmed, they seem to have lapsed. With a large number of vacancies of para-medical, technical and those related to general administration, there could not be proper working conditions for the doctors working specially in Safdarjung hospital. There seemed to be total lack of co-ordination between the Hospital Administration and DGHS. The Committee felt that position would be similar more or less in other Central Govt. hospitals outside Delhi. The Committee was of the view that the Department would have to take the initiative in revamping and streamlining the administration of these hospitals. First step should be the immediate review of all vacant/lapsed posts of all categories. Thereafter, the Department should initiate the process of filling up the vacant posts at the earliest. The Committee was also of the view that a monitoring/co-ordination mechanism needed to be evolved which could serve as a link between DGHS and hospital administration.

12.68 While appreciating the initiatives being taken by the Department, the Committee wanted to be apprised about their status, particularly in those states where the diseases under the programme were more prevalent. The Committee pointed out that inspite of higher allocation of Rs. 1349 crores in Tenth Plan and implementation in convergence mode, ground realities continue to be the same. During the first two years of Tenth Plan, funds remained underutilized due to lengthy process of procurement and non-filling of vacant posts. As per the information made available to the Committee, out of Rs. 1349 crore allocated for the Tenth Plan, at the end of three years, funds amounting to Rs. 633.33 crores were still available with the Department. This amount was likely to increase, as the actual figures of expenditure for 2004-05 were not available.

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12.69 The Committee was of the view that Department should take the initiative in co-ordination with the concerned state govts/implementing agencies for monitoring the Malaria Control Programme in those States showing increasing number of cases and deaths during the recent years. 12.70 The Committee was surprised to note that Drug Distribution Centres and Fever Treatment Depots either do not exist or are practically non-functional in many high-risk areas in the States. While appreciating the initiative taken by the Department, the Committee emphasized that mere holding of meetings or issuing instructions would not achieve any noticeable result. The Department had to sustain this initiative by regularly monitoring the activating/establishing of DDCs/FTDs and expanding their involvement in activities like IEC, social moblisation etc. 12.71 The Committee pointed out that the Department should make all possible efforts for activating the existing/required machinery for the proper implementation of the programme. The Committee strongly felt that the Department would have to continue monitoring by sending inspection teams to the affected districts of the state. 12.72 The Committee was of the view that like the other states not performing well, in Gujarat also, only intensive monitoring could result in controlling the out-break of Malaria cases. The Committee, accordingly, recommended that the Department should continue the initiative taken by it. 12.73 The Committee was of the view that in order to achieve the goal of elimination of Kala-azar by 2010, concerted efforts needed to be made to focus, on the problem areas in highly endemic districts of all the four States, particularly Bihar, both by the Department/implementing agencies. (Para 10.8) 12.74 White appreciating the work being done under RNTP, Committee expressed its serious concern on another assessment of the field study. Outstripping of management and financial capacity at Central and State levels by the extra ordinary rapid expansion of the disease nullifies all the achievements made under the programme. 12.75 The Committee noted with serious concern the WHO estimates of approximately 18 lakh new cases being reported in the country early year, out of which 8 lakh were new smear positive highly infections case. The Committee noted that massive funding and trained manpower along with a very large number of NGOs and private practitioners failed to keep pace with the report expansion of disease. The Committee, therefore, was of the view that there seemed to be a need for refocusing on vulnerable areas. It seemed that the ground realities did not seem to be very conducive in all the states. Therefore, district specific implementation of the programme is the need of the hour. For example, one practical problem being observed was that drugs being prescribed for very short period and for that too patients have to cover a very long distance from their home to clinic. Not only this, there were areas where hospitals were not ideally located. The Committee, therefore, strongly felt that some element of flexibility should be permissible in the implementation of the programme. The Committee also felt that it needed to be ensured that there was more active participation both from NGOs/Private practitioners in vulnerable areas, even of they are not conveniently located. 12.76 The Committee was, however perturbed to note that cataract surgery rate in NE States was below 100 except in Tripura. Assam is one of the lowest performing states in the country with cataract surgery rate of 77. In its earlier Report also, the Committee had expressed its serious concern about the dismal status of the National Programme for Control of Blindness. The Committee had accordingly recommended that there is a need for special focus on NE States with regular monitoring of the programme by the Department. 12.77 The Committee was of the view that unspent balance available with the implementing agencies clearly indicated that benefits of scheme were not reaching the targeted beneficiaries. The Committee pointed out that during the Ninth Plan, against release of Rs. 587.73 lakhs as Grants-in-aid to North East States; expenditure incurred was Rs. 695.55 lakhs, thus indicating Rs. 107.82 lakhs as unspent balance of previous Plan Period being used by the District Blindness Control Societies. The Committee observed that, with the beginning of Tenth Plan, unspent balance had again started to accrue as indicated below- (Rs. in lakh)

2002-2003 2003-2004

Allo. Exp. Unspent Bal. Allo. Exp. Unspent Bal.

136.27 76.78 59.49 90.56 39.56 51.00

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Position was not different with regard to cash grants/ released to North East States. Against a Ninth Plan allocation of Rs. 1212.13 lakhs, expenditure was only Rs. 526.64 lakhs with an unspent balance of Rs. 685.49 lakhs. Trend of allocation and expenditure doing the first two years of Tenth Plan indicate that this unspent balance is also being utilised. (Rs. in lakh)

2002-2003 2003-2004

Cash grant Exp. Unspent Bal. Cash Grant Exp. Unspent Bal.

41.20 70.48 29.28 39.00 89.87 50.87 The Committee apprehended that expenditure figures of 2004-05 would also reveal the same trend. The Committee wanted to be apprised about the fund allocation and unspent balance available with District Blindness Country Scientists during the first three years of the Tenth Plan. 12.78 The Committee wanted to be apprised about the status of fund allocation and utilization thereof during the first three years of Tenth Plan in Bihar (District wise). 12.79 The Committee hoped that with the enhanced management support, involvement of Mahila-Mandals, NGOs and Gram Panchayats etc. and close monitoring, a positive impact on the implementation level would be noticed. 12.80 The Committee felt that there was a need for reassessing the role of District Collector and if possible, involvement of some other Govt. representative who could be assisted in his monitoring/supervision with public representatives from village level Panchyat to local MPs. The Committee also pointed out that in view of inadequate eye care facilities in rural areas and difficult terrains, involvement of NGOs should be increased. 12.81 The Committee was of the view that external assistance which comes in the shape of Grant-in-aid and distinct from loan, should flow over and above the Gross Budgetary Support. The Committee therefore recommended that the Department should actively pursue this matter with the Planning Commission. The Committee also pointed out that this funding process should be made applicable in respect of foreign funds flowing for other disease control Programmes also. The Committee, however, pointed out that massive foreign funding should also have an effective monitoring mechanism to ensure its optimum and judicious utilization. 12.82 While appreciating the inbuilt monitoring mechanism under the programme, the Committee wanted to have the details of financial assistance released to NGOs during 2002-03, 2003-04 and 2004-05. The Committee also wanted to have the details of NGOs found to be indulging in malpractices during this period statewise and action taken against them. The Committee observed that the level of involvement of NGOs in the Programme seemed to depend upon the number of active NGOs coming forward in a particular area. The Committee felt that if this was the position, then there was a need for reviewing the criteria for selection of NGOs. Number of NGOs needed to be regulated by the existing HIV Risk population. There should be a specific norm for restricting the number of NGOs in a particular area. 12.83 The Committee felt that level of expenditure on publicity/advertisements in view of total allocation, meant for different equally and even more vital components, seemed to be on the high side. The Committee wanted to be apprised about the IEC activities undertaken in high prevalence States and expenditure incurred thereon during 2003-04 and 2004-05. 12.84 The Committee was happy to note that in-principle decision had been taken by the Govt. to provide anti- retroviral drugs to children and women affected with full blown AIDS. Eight Govt. hospitals in six high Prevalence states and NCT of Delhi had started giving free ART from 1st April, 2004. Additional eight hospitals had been identified for starting ART from August, 2004. The Committee felt that this initiative needed to be implemented effectively as number of AIDS patients i.e. 1213 in the first phase seemed to be negligible in the light of such patients reported in high prevalence states. The Committee felt that for achieving the target of free ART to 100,000 AIDS cases by 2007 and to 180,000 cases till 2009 vigorous efforts would have to be made by the Department as well as the implementing agencies.

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12.85 The Committee wanted to be apprised about the strategy adopted for procurement of anti-retroviral drugs provided free of cost on a pilot project basis in 2004 to a selected small number of patients. The Committee also wanted to know about the fate of the report of the Working Group given in 2003. 12.86 The Committee also noted a very disturbing observation made in the Audit Report It had been pointed out that although the Ministry had announced in December, 2002 that blood donors found to be HIV positive would be told of their infection and asked to seek confirmatory tests and counseling, NACO continues to follow the existing policy of giving the results only to those persons who ask for these. The Committee agreed with the audit observation that non-disclosure of HIV status, mandatorily to all HIV infected reasons could lead to such persons unknowingly spreading the disease among the uninfected persons. The Committee was not inclined to accept the argument of the Department that HIV status was revealed only to those donors who would want their status known, as any other approach would adversely affect voluntary blood donation movement. The Committee emphasized that a rethinking was required on this sensitive issue in view of the dangerous implications of this policy.

12.87 The Committee was constrained to note that the appraisal exercise of proposals submitted by State Govts was still going on. The Committee emphasized that the Deptt. should make concerted efforts to expedite the process of approval so that implementation could be started. The Committee pointed out that the eleven States/UTs which had failed to forward their proposals should be actively pursued for doing the same.

12.88 The Committee wanted to be apprised about the number of States where such Authorities have been created. 12.89 The Committee hoped that as recommended by the evaluation study, the Programme would have been revised. The Study had also emphasized that more RCCs needed to be recognized in uncovered areas and additional RCCs in populous States. The Committee felt that in view of increasing incidence of Cancer cases in the country, this recommendation should be given top priority and implemented at the earliest. 12.90 The Committee wanted to be apprised about the number of districts covered under the Programme (Statewise). The Committee also wanted to have an idea about the status of this Programme after the completion of five-year project period/Statewise. The Committee emphasized that in view of enhancement of financial assistance under this Programme, effective monitoring mechanism should be evolved so that allocated funds reached the identified districts. 12.91 The Committee noted that the details were in the process of being worked out. The Committee was of the view that decision on this vital aspect of health core and management had been over-delayed. The Committee, therefore, emphasized that all required steps for the setting up of Medical Grants Commission needed to be expedited. 12.92 The Committee felt that approval process of these proposals needed to be expedited. 12.93 The Committee impressed upon the Department not to further delay the Procurement of the proposed Mobile Unit, specially in view of disaster prone geographical position of the country. 12.94 The Committee was, however, surprised to note that these Pilot Projects had not taken off and no provision was envisaged during the Tenth Plan. The Committee was of the view that the Department should make an assessment of increasing incidence of such diseases and initiate programmes for implementation of their prevention/control. The Committee noted that central assistance had been released to few states under these two projects. The Committee was surprised to note that the scheme regarding State Govt. medical colleges/ hospitals had been discontinued from 2003-04 due to non-availability of funds. The Committee strongly felt that a review on the decision needed to be taken up and if necessary, matter might be taken up with the Planning Commission//Finance.

(e) 8th Report

12.95 Committee observed that there had been significant changes in the demographic and health profile of the country. The Committee , however, pointed out that average rate of various health indicators did not indicate the ground realities in the big and populous states of the country. The Committee noted that

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performance level in such states continued to remain much below the average national rate. A few examples as indicated below are self-revealing:-

Neo-Natal Mortality Rate 2002 (Source Sample Registration System, Registrar General of India) State Year (2002) Assam 45 Orissa 53 Rajasthan 48 Uttar Pradesh 47 India 41

Infant Mortality Rate (IMR)- 2002(Source Sample Registration System, RGI) State Year (2002) Assam 70 Chattisgarh 73 Orissa 87 Rajasthan 78 Uttar Pradesh 80 India 63

Committee was not fully convinced by the contention of the Department that SRS, RGI had estimated the MMR for the country as 407 per 100,000 live births in 1998 which was the same period when NFHS-II had estimated the NMR as 540 per 100,000 live births. The fact remained that there were some problem areas in data collection. Non-availability of reliable estimates of maternal mortality had been admitted by the Department also in its Annual Report (2004-05). The Committee noted that an expert group had been constituted in the Department which was looking into the modalities of carrying out a survey for collection of data on Maternal Mortality. A Pilot survey for this had already been completed. Similar problems might be there in respect of other health indicators also. The Committee, therefore, was of the view that the Department should carry out a comparative analysis of findings of NFHS-I and NFHS-II in order to understand the factors responsible for discrepancies in the two Survey Reports. The Committee also emphasised that the entire Family Welfare planning was based on the National Surveys being conducted at regular intervals. Therefore, it should be ensured that accurate data was made the basis of all health surveys. This could be achieved to a large extent by monitoring of data being obtained specially from the states not performing well by involving Central teams also in the collection of data, to the extent possible.

12.96 The Committee was constrained to observe that the expected levels of some of the indicators by the terminal year of the Tenth Plan were very high when compared with the actual achievement level reached by the end of Ninth Plan, i.e 2002. The Committee felt that the percentage of performance reached at the end of the Ninth Plan was virtually the same in respect of these indicators. The Committee was, therefore, of the view that the immediate goal of the Department/State Govt./implementing agencies should be put to a sustained exercise in motion where under the weakest performing districts (state-wise) were identified and targeted interventions were initiated, accompanied by regular monitoring. 12.97 The Committee noted that the approved outlay for the Tenth Plan stands at Rs. 26,126 crores which is almost double the Ninth Plan allocation. The Committee was, however, constrained to note that position had remained virtually the same in the first three years of the Tenth Plan as evident during the Ninth Plan. Allocated funds continued to be reduced at the RE stage and even those reduced funds remained under utilized:- (Rs. in crores)

2002-03 2003-04 2004-05

BE RE AE BE RE AE BE RE AE-provisional

4930.00 4150.00 3916.00 4930.00 4700.00 4409.27 5780.00 5300.00 5300.00

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The Committee was not hopeful about full utilization of allocated funds in 2004-05. The Committee expressed its serious concern over the element of unspent balances available under majority of the schemes during the first three years of the Tenth Plan. The very fact that unspent balances continued to be available from year to year under any scheme could lead to only two conclusions. Either the projected allocation had not been based on a scientific assessment or failure of the implementing agencies in reaching the targeted beneficiaries. Both the situations need serious review/rethinking of implementation process of such schemes. The Committee, accordingly, impressed upon the Department to take remedial measures in the matter.

12.98 The Committee noted that NRHM was the most ambitious Project proposed to be launched in the Health and Family Welfare Sector. Mission had received the Cabinet approval very recently, i.e. 4th January, 2005. States were now being advised to undertake preparatory activities. The Committee had been given to understand that in view of the recent Cabinet approval, requirement for activities under NRHM could not be included in the proposal sent to the Planning Commission. A minimum of Rs. 600 crores would be required as additional budgetary support during 2005-06. 12.99 Objectives of the Mission were laudable and were very much required in the present scenario. The Committee observed that divergent activities not only of the Ministry of Health and Family Welfare, but also number of other Ministries were proposed to be implemented in an integrated manner. Two Departments of the Ministry-Health and Family Welfare had been integrated for optimum utilization of financial resource and manpower. The Committee, however, had a word of caution in this regard. Both the Departments as separate entities were already implementing large number of schemes and supervising institutions falling under their respective jurisdiction. Not only this, quite a few programmes under both the Departments were not being administered effectively due to a very weak monitoring mechanism relying only on state figures. The Committee felt that with the convergence of a number of Health and Family Welfare Schemes under NRHM, effective monitoring might not be feasible. The Committee, therefore, emphasised that dilution of services at present available separately under the two Departments must be avoided at all costs.

12.100 The Committee wanted to be apprised of exact number of Sub-Centres established (state-wise) during the first three years of Tenth Plan.

12.101 The Committee was surprised to note that some states had already established PHCs in excess of the prescribed norms. There were also states where shortfall in the number of PHCs was evident. Against a population norm of 30,000 per PHC, average rural population (2001) per PHC is 45,095 in Bihar, 37,169 in Madhya Pradesh, 36348 in Tripura 36,169 in U.P. 49,231 in West Bengal and 1,18,090 in Delhi. The Committee was not convinced by the clarifications of the Department that the target for establishment of PHCs was given by the Planning Commission to the respective States/UTs and it was the responsibility of the State/UTs to establish them. The Committee strongly felt that with funds being provided under PMGY scheme, it was the responsibility of the Department to monitor the establishment of PHCs. 12.102 The Committee was of the opinion that in view of the non-adherence to the prescribed population norms, whether short or excess by majority of the states, it was time that a review of the existing population norms were looked into by the Department 12.103 The Committee understood that the Report of the NCAER study was at present under the considerations of the Department. The Committee emphasised that the Department should initiate action at the earliest for strengthening the functioning of Sub-Centres, PHCs and CHCs, the only service providers to the targeted beneficiaries in the remote and inaccessible areas in the country. A beginning could be made with the fourteen states where the sample study was conducted by NCAER. The Committee also emphasised that a similar study was also required to be undertaken with regard to functionaries of both PHCs and CHCs which were also the main service providers likes Sub-Centres.

The Committee pointed out that demographically weak states has higher birth rate and Infant Mortality Rate. The workload of ANMs in these states was thus higher. The Committee, therefore, felt that in such states, sanctioning of ANMs should be based on existing norms as per 2001 population. At the same time, the Department should also closely monitor the filling up of all the sanctioned posts of ANMs. 12.104 The Committee had taken seriously the under-utilization of funds under Urban Family Welfare Services for a number of years in succession and the reason being the same. The Department perhaps did not

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take any remedial steps to improve the situation. The Committee felt that based on the recommendations of the evaluation study, steps would be taken for strengthening/expansion of the scheme. 12.105 The Committee, however, emphasized that besides organizing workshops meeting with state/district level officials, inspections both regular/surprise by designated central officials should also be initiated The Committee welcomes all these very significant initiatives being taken by the Department and hopes that they would be implemented as envisaged to get the desired results. 12.106 The Committee observed that more or less the same factors were responsible for under-utilisation in the first two years of the Tenth Plan. The Committee noted that an enhanced allocation of Rs. 1380.68 crores had been made for 2005-06, based upon an assessment of demands of the States/UTs, and the committed liabilities of the States. The Committee viewed with serious concern the availability of unspent funds with different states under this programme. 12.107 The Committee was not inclined to accept this feedback for the simple reason that as per the latest information given by the Department itself, against a total allocation of Rs. 2461.57 crores, utilization figures are Rs. 1638.49 crores and unspent balances were Rs. 823.07 crores. This clearly indicated that funds were being released under the RCH Programme on regular basis, availability of unspent balances with states making no difference. Position with regard to a few States found alarming last year by the Committee, continued to be the same as indicated below:-

(Rs. in crores) State Grant Released Amount utilized Balance Bihar 174.38 93.64 80.74 Jharkhand 32.68 7.12 25.56 Gujarat 185.87 85.37 100.44 Madhya Pradesh 153.40 110.31 43.09 Chattisgarh 33.63 26.62 7.00 Maharashtra 140.97 97.27 43.69 Orissa 87.49 46.04 41.44 Rajasthan 172.51 97.73 74.78 Uttar Pradesh 495.68 350.76 145.41 West Bengal 135.64 95.78 40.38

The Committee was also perturbed to note that in respect of some states, quantum of unspent balance being more than the funds utilized by them clearly indicated their failure to take benefit of such a vital scheme of Family Welfare. What was more worrisome was that all these States/UTs with the exception of one of two were very small having a tribal population, where the need of this programme was found the most:-

(Rs. in crores) States Grant Released Amount utilized Balance Jharkhand 32.68 7.12 25.56 Gujarat 185.81 85.37 100.44 A &N Islands 3.57 1.70 1.86 Chandigarh 3.60 1.56 2.03 Daman & Diu 2.54 .77 1.76 Lakshadweep 2.38 .69 1.68

12.108 The Committee noted that the Department had initiated some remedial measures, creating State and District Management Units engaging qualified Managers, Accounts persons and a qualified Financial Expert which were the required initiatives. The proposal of the Govt. to continue with the process of organizing workshops and meetings with state and district level officers was welcomed. The Committee, however, emphasized that besides organizing workshops/meetings with State/district level officials, inspections both regular/surprise by designated Central Govt. officials should also be initiated. 12.109 The Committee, therefore, was of the view that the Department should evolve a system whereunder besides State Govts. other Stakeholders also have a decisive role to play.

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12.110 A comparative analysis of funds released and achievement level of physical targets of these interventions presented a very discouraging position. Against an allocation of Rs. 109.88 crores under ANM scheme, only 6335 ANMs were given contractual appointment. Similarly, for PHN/Staff Nurse, against an allocation of Rs. 31.04 crores, only 1467 PHNs could be given contractual appointment. Allocation for Lab Technicians stood at Rs. 8.37 crores, number of contractual Lab Technician was only 381. Similarly, for hiring of SM Consultant against an allocation of Rs. 3.61 crore, only 1054 Consultants could be appointed. For hiring of private Anaesthetists, Rs. 83.73 lakhs had been provided and number of Anaesthetists hired was only 1059. In a number of interventions, although funds had been duly released not even a single contractual appointment seemed to have been made in the States of Bihar, Jharkhand, Tripura, Uttaranchal, Karnataka. In the case of other states also, level of physical achievement was found very poor when compared with the quantum of funds released. 12.111 Non-availability of sufficiently qualified manpower in the states was the main reason cited for non-achievement of contractual appointments of ANMs/PHNs/SNs/ Lab Technicians. Sufficient number of Anaesthetists in the private sector was not available at sub-district level. Honorarium of Rs. 800/- per visit was found not adequate enough to motivate Safe Motherhood Consultants being mainly lady doctors to travel to remote areas. The Committee felt that all these interventions which would continue to be available under the flexible RCH pool needed to be revamped in view of the ground realities. Not only this, practice of funds being released without showing any achievement needed a review in view of non-utilization of such Govt. funds for considerable period. 12.112 RCH camps were initially permitted for 117 districts of 21 states and 7 UTs and then to all the districts of EAG states, i.e. Bihar,Orissa, M.P, Rajasthan, Uttaranchal, U.P, Jharkhand and Chattisgarh Rs. 19.70 crores has been released so far and total number of camps organised is 7283. The Committee has been given to understand that funds are released to the states as per their proposal and also subject to the submission of UCs and Audit Report for the earlier years. The Committee notes that a variety of services are being provided in the RCH camps by the states. As per the information made available to the Committee, states like Assam, Gujarat, Himachal Pradesh, J&K, M.P, Maharashtra, Rajasthan, Uttaranchal, and U.P have been very active in holding RCH camps. However, the Committee is constrained to observe that in the case of EAG states like Bihar, Chattisgarh, Jharkhand and Orissa no information is available inspite of there being provision to hold RCH camps in all the districts of EAG states. The Committee strongly feels that these states should be persuaded to take maximum benefit of this facility. 12.113 The Committee observed that exercise of revision of this scheme has been going on for the last two-years. As a result, funds allocated had remained under-utilized. Against the allocation of Rs. 500 crores in the Tenth Plan, the expenditure for first two years was only Rs. 87.57 crores and the balance available for the remaining period is Rs. 300.43 crores. The Committee felt that there should be no further delay and finalization of the schemes should be expedited. The Committee also emphasized that the Department should not be complacent by just revising the scheme, rather an effective monitoring mechanism should be evolved for its proper implementation.

12.114 The Committee had observed that under the existing scheme, there was no mechanism to ascertain the exact number of actual beneficiaries of the scheme. The Department had been estimating the number of beneficiaries on the basis of amount of grants released to the District Authorities. The Committee felt that under the proposed revised scheme, there should be an inbuilt mechanism so that there was periodic survey to verify the exact number of beneficiaries. The Committee also observed that state-wise details of estimated number of beneficiaries indicated that those states where need for population stabilization measures was the most did not seem to be taking benefit of this scheme. The Committee was of the opinion that the revised scheme should be given due publicity, specially in backward/tribal areas. 12.115 The Committee had also noticed that under the existing Scheme due to unspent balances, non-receipt/ late receipt of UCs/Audited accounts/receipt of incomplete/incorrect documents, there was improper and under utilization of allocated funds. This was evident in respect of all the States in the country. The Committee, therefore, emphasized that all preventive measures need to be taken to avoid such problems/shortcomings under the revised scheme.

12.116 The Committee was not inclined to agree with the justification for underutilization of funds given by the Department. The Committee felt that the Department would have to focus on State- specific strategies for optimum and judicious utilisation of allocated funds. The Committee observed that as per RHS-2002, immunization level of children is 49%. The Department would have to make concerted efforts to reach the

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target of 100% coverage of children under immunization against six preventable diseases by the end of Tenth Plan, 2007. 12.117 The Committee was a bit apprehensive of the commitment of the Government to eradicate all strains of the poliovirus in near future. The Department had now confirmed that as on 14th March 2005, 136 cases of Polio were reported in the country in 2004, out of which 82 were from U.P and that too, 21 from Moradabad and 12 from Badaun district. Analysis of cases in Moradabad and Baduan had shown that poor micro-planning, training and social mobilization were the main factors responsible for high rate of Polio in these districts. 12.118 The Committee found that the justification given by the Department that due to the poor quality of rounds undertaken between July to Sept.2004 because of floods can not be considered very convincing. The Committee felt that the Department had to anticipate this kind of situations and take remedial action well in time. The Committee hoped that with the high quality of supplementary immunization activity planed for 2005, things would improve in the State. The Committee also emphasized that the remedial measures as initiated in affected districts of UP in the wake of increase in the number of Polio cases might also be undertaken in all the affected districts of Bihar. 12.119 The Committee expressed its serious concerns about the fate of a project initiated with laudable objective. It took three years to implement the decision of setting of the Kosh. Almost two years have passed since then and the seed money of Rs. 100 crores available under the Kosh is lying unutilized. The Committee could understand the total lack of contributions/donations from any sector. The Committee, however, failed to understand the rationale for non-utilisation of funds available under the Kosh. The Committee found that the approval of the Cabinet had been obtained for reconstitution of the Kosh so as to increase its membership and establish it as an autonomous society, free to operate in a non-bureaucratic mode. The Committee emphasized that adequate publicity about the availability of funds under the Kosh for providing financial assistance for Projects on Population Stabilisation and also for inviting contribution to the same needed to be given. 12.120 The Committee was apprehensive of the justification as the reduction in allocation during 2004-05 was very marginal for non-procurement of Laparoscopes whereas increase in the year 2005-06 was abnormally high for purchase of the same item. The Committee therefore recommended that the allocation available for a specific purpose should be utilized in proper, just and equitable manner.

12.221 The Committee observed that the initiative taken by the Hindustan latex Family Planning Promotion Trust in selected districts of MP, Orissa, Jharkhand and Bihar was a positive development. The Committee found that another area project on social marketing was being implemented by the Society for Women and Child Health in four districts of Haryana from April, 2000. The Committee felt that the results of these two initiatives should be shared with other reputed NGOs so as to motivate them to implement similar projects in other weak performing districts. The Committee was of the view that the Department might make an assessment in this regard and coordinate with the concerned State Govts. and implementing agencies.

12.122 The Committee noted that a number of remedial majors like media and visual publicity, training of doctors and NSV and involvement of IMA in increasing awareness among private doctors in this regard, had been initiated by the Department during 2004-05. The Committee also observed that on the basis of inputs received from EAG states, the compensation package for undergoing Tubectomy, Vasectomy and IUD insertion had been revised from 2003-04. The Committee hoped that with these measures there would be an increase in the acceptance level of male acceptance of family planning methods.

12.123 The Committee was not in agreement to the suggestion of the Department for being exempted from earmarking the mandatory allocation of 10% for the NE region. The Committee felt that the appropriate action would be to initiate new schemes including those aimed at establishing new Primary Health Care Institutions and also adequately augmenting staff strength in NE Region.

12.124 The Committee had been given to understand that with the launching of National Rural Health Mission, a steering Committee had been set up in the Department which would also be responsible for implementation of Family Welfare programmes in the NE Region. An officer in the Department had been specifically deputed for this purpose. The Committee was also informed that budget provision for NE states for 2005-06 had been enhanced by 30%. The Secretary assured the Committee that with these initiatives, there would be proper focus on this remote and inaccessible area.

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12.125 The Committee had, however, a word of caution for the Department. Committee’s attention had been drawn by media reports about diversion of Central Funds meant for NE states due to pressure of underground outfits. The Committee understood that this issue was discussed in a recent meeting chaired by the Cabinet secretary. The Committee emphasised that in States like Manipur, Nagalnd and some parts of Assam, due to underground activities, impact of various Central Family Welfare Programmes is not visible. Infrastructure is simply not there. There is acute shortage of doctors and other allied staff. The Committee was of the view that proper monitoring mechanism was evolved so that the enhanced funds meant for Family Welfare services in N.E. region were appropriately utilized and relevant infrastructure was established. Inspection by Central teams, both regular and surprise may also be conducted, especially in view of reported diversion of Central funds.

12.126 The Committee felt that the list of MNGOs should have been readily available with the Department. The Committee also failed to understand the constraints being faced by the Department in furnishing the list of MNGOs to the Members in whose constituencies, the districts allotted to these MNGOs are located. The Committee pointed out that the addresses of Members of Parliament could easily be obtained from the Website of Parliament Secretariat. The Committee therefore emphasized that the Department should make arrangements for submitting the list of MNGOs to the local Members of Parliament without any further delay. 12.127 The Committee view with serious concern the irregularities in Annual Review Report 2003-04 of the Department. The Committee strongly felt that irregular charging of states General side Expenditure to the Family Welfare Budget was a very disturbing trend as it had been happening for years. As per the information made available to the Committee, amount transferred to Personal Deposit Account is Rs. 1.25 crores and amount involved due to irregular charging of States General side Expenditure was Rs. 24.50 crores and the States involved are UP, Punjab, Haryana, Uttaranchal and UT of Chandigarh. The Committee was of the view that the Department should pursue with the concerned States for corrective measures so as to avoid occurrence such irregularities in future.

(f) 9th Report

12.128 The Committee noted that against an allocation of Rs. 364.43 crore during the Ninth Plan, funds amounting to only Rs. 293.72 crore could be utilised. An enhanced allocation of Rs. 775 crore had been made for the Tenth Plan. The Committee noted that although utilisation position of allocated funds in the first year of the Tenth Plan i.e. 2002-03 was not satisfactory, during the second year, the Department could utilise the entire allocation provided at the RE stage. For 2004-05, provision of Rs. 173 crore was enhanced to Rs. 200 crore. The Department justified this enhanced allocation by utilizing Rs. 195.26 crore by 28th March, 2005. 12.129 The Committee noted with satisfaction that with the increase in allocation, capacity of the Department to utilise the same was also increasing. The Committee pointed out that trend of utilisation is not evenly spread in all the quarters of the financial year of 2004-05. Against plan allocation of Rs. 200.00 crore in 2004-05, the Department could utilise Rs. 121.33 crore by the end of third quarter, i.e. 31st December, 2005. By 7th March, 2005 it increased to Rs. 179.49 crore and by the 28th March, 05, utilisation figures were Rs. 195.26 crore. This clearly showed that out of total allocation of Rs. 200.00 crore in 2004-05, an expenditure of RS. 74.00 crore was made in the last quarter of the year. The Committee was of the view that the pace of utilisation should be as per the prescribed financial norms. Expenditure on the high side in the last quarter of the financial year would not be considered good for the health of budget planning. 12130 The Committee, accordingly, requested that the Department should make concerted efforts for optimum and judicious utilisation of allocated funds in individual schemes/programmes to the extent possible. 12.131 The Committee would like to be enlightened in this regard. Committee’s attention was also drawn by provision of Rs. 20 lakhs in 2003-04 for conducting elections of CCH which remained unutilized due to the fact that elections could not be conducted. Provision was there for this purpose in 2002-03 also. These elections were finally conducted during the year 2004-05 as the provision meant for this purpose had been utilised. The Committee wanted know as to whether both these statutory bodies were duly constituted with full membership. 12.132 The Committee, however, found that in the case of CCIM, during 2004-05, Central Register of Delhi and Tamil Nadu was updated upto March, 2001 and in the case of Orissa and Rajasthan upto March, 2002.

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The Committee failed to understand the factors responsible for the Central Register of Indian Medicine not being updated. The Committee would like to be apprised about the position in respect of other States. The Committee would also like to have an idea about the status of the Central Register being maintained by the Central Council of Homoeopathy. 12.133 The Committee was of the view that there needed to be an effective monitoring mechanism for regulating the AYUSH doctors practicing across the country. The Committee, therefore, recommended that immediate action was required to be taken either by the two councils or any other body which is empowered to regulate in such matters. 12.134 The Committee was constrained to observe that during 2004-05 also, position remained the same. The Committee found that during 2005-06 Rs. 1 crore had been provided for the proposed Council. The Department had informed that the Bill had been prepared and the comments of the Ministries of Finance, HRD and Health & Family Welfare obtained. The draft Bill was almost ready and was to be introduced in Parliament shortly. The Committee reiterated that there should be no further delay for introducing the Bill in Parliament. 12.135 The Committee observed that although Rs. 97 lakhs were spent during the Ninth Plan period, nothing seemed to have materialized in the operationalisation of the centre. The Committee had to make such a comment only because of trend of expenditure in the three years of the Tenth Plan. Rs. 26 lakhs were provided in 2002-03 but the allocated funds remained unutilized. There was no provision during 2003-04. However, in 2004-05 Rs. 1 lakh had been provided for this Centre. The Committee strongly felt that any scheme/plan proposed to be implemented should only be taken up after due consideration of its feasibility and other allied aspects. Advanced Ayurvedic Centre for Mental Health in NIMHANS, Bangalore seemed to be forsaken by the Department. The Committee would like to be apprised about the actual status of this Centre.

12.136 The Committee observed that during 2004-05 physical targets were not achieved fully inspite of there being full utilisation of funds. Plan allocation for 2005-06 stood at Rs. 12.50 crore which was higher than Rs. 8 crore provided in 2004-05. The Committee emphasized that all required steps should be taken for achieving the physical targets for which plan funds were meant for. The Committee observed that during the last two years of Ninth Plan also physical targets could not be achieved fully. The Committee apprehended that during the Tenth Plan also, so far, the position would be the same. If that would be so, then there was a need for making quarterly assessment about the achievement of physical targets. 12.137 The Committee would like to be apprised about the specific purpose for which this additional allocation was meant for. The Committee pointed out that the construction of building for RRUM had been continuing for about 8-10 years. The Committee wanted to be enlightened about the original estimate and the actual expenditure on this construction project. 12.138 The Committee wanted to have an idea of quantum of funds spent on construction activities during the first three years of Tenth Plan. The Committee also wanted to know about the status of all the research Institutes functioning under CCRA. 12.139 The Committee observed that research projects were being implemented by different agencies. The Committee wanted to have a status note on the contributions made in this sector. One of the important mandated activities under this Head was to assist research projects and interventions which validated efficacy claims relating to AYUSH. An idea about the achievements made in this regard might be given. 12.140 The Committee observed that undue delay had taken place in conducting the survey on usage and acceptability of AYUSH. The Committee was perturbed to note that the although funds were available, considerable time was taken in deciding the survey agency and other allied matters. It had taken the entire Ninth Plan and more than half of Tenth Plan for conducting of survey which was very vital for propogating AYUSH. The findings of the survey confirmed the apprehensions of the Committee about the lack of publicity and resultant lack of demand for AYUSH in the general public in the country. The Committee would appreciate if there was no delay in taking follow up action on the findings of the survey and the Department should initiate the remedial measures at the earliest. 12.141 The Committee appreciated the initiative and hopes that the survey would be completed at the earliest and its findings would be made use of.

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12.142 The Committee was, however, constrained to note that procedural formalities remained to be completed. The Committee emphasized that the actual construction of the project should be done as per a time bound action Plan which should be strictly adhered to. All precaution should be taken for not allowing the present estimate to exceed the present cost.

12.143 The Committee was not convinced by the contention of the Department that the process of new recruitment was to be taken up by the UPSC and revival of old posts was complicated and time consuming. The Committee was of the view that when the existing CGHS dispensaries were not fully functional for lack of AYUSH manpower, fate of AYUSH dispensaries proposed to be opened could be well imagined. 12.144 The Committee cautioned the Department that the proposed project should not remain a new initiative during the Tenth Plan. Action should start without any further delay. The Committee apprehended that like in other projects, this project might continue at the proposal stage for considerable time with resultant increase in actual cost of the project. With free land made available by the State Govt. and funds also available under the lump sum provision, action for clearance of all procedural formalities was required to be taken by the Department.

12.145 The Committee expressed its serious concern over the tardy progress made in providing the required staff essential for its efficient functions. The Committee failed to appreciate the proposal of the Department of Expenditure of outsourcing of staff for the Board. The Committee was of the view that there should be creation of all required posts. The Department should make concerted efforts for getting the EFC and Cabinet approval for creation of required posts at the earliest. 12.146 The Committee, however, strongly felt that higher allocation of funds did not have any meaning in the case of these labs. Lack of infrastructure was adversely affecting the achievement level of various physical targets set by the two labs. 12.147 The Committee was anguished to note that another plan period would be over and these two labs continued to suffer from lack of required staff. The Committee found that PLIM continued to function without a Director. Nothing could be more unsatisfactory. In view of a very large variety of AYUSH drugs in the open market, these labs have to be fully operational. The Committee reiterated that the Department should vigorously purpose the matter with the Ministry of Finance and other authorities. 12.148 The Committee hoped that there would be no further delay due to formal clearance by Fire Department and other allied agencies. 12.149 The Committee was constrained to note that all the above schemes were proposed to be launched without going into the feasibility aspect. As a result, after three years two of the schemes had to be dropped. One was transferred to another scheme and two were merged with the main scheme of drug quality control. It took 3 years to realize that the subject of regulation of health food supplements belonged to the Department of Health as per the Allocation of Business Rules. Therefore, the Scheme of Health Food Supplements was transferred to the Department of Health. 12.150 The Committee expressed its dissatisfaction with the scant feedback about spurious AYUSH drugs for such a big country and that too for a period of three years. The Committee emphasized that the Department should pursue with all the departments so that preventive/deterrent action could be initiated, wherever required.

12.151 The Committee recommended that if need be, this Cell would be strengthened and function as a nodal agency in the vital area of curbing of manufacture and sale of spurious AYUSH drugs. 12.152 The Committee appreciated the initiative taken by the Council and the Department. The Committee, however, felt that the Department should also inform the scientists of Harvard Medical School about the rationale for the presence of metals in Ayurvedic drugs and their safety aspect. 12.153 The Committee wanted to be enlightened about the follow up action taken in this regard. 12.154 The Committee was of the view that the Department should pursue this proposal with all concerned authorities.

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12.155 The Committee felt that a decision in this matter should be taken after considering the views of all stakeholders. 12.156 The Committee welcomed this ambitious partnership programme and hoped that research work to be undertaken under this project would yield fruitful results for all concerned. (g) 10th Report

12.157 The Committee felt that in order to ensure quality and standard of education, affiliation to a University was a mandatory condition for every college. Specific mention in this regard needed to be incorporated in the definition of ‘Homeopathic Medical College’. The Committee, accordingly, recommended that the following definition of ‘Homeopathic Medical College’ may be inserted after clause (d) in section 2 (1) of the Principal Act --

‘(da) “Homeopathic Medical College” means a college of Homoeopathy, whether known as such or by any other name affiliated to a University, in which a person may undergo a course of study or training including any postgraduate course of study or training which will qualify him for the award of a recognized medical qualification.’

12.158 The Committee felt that the definition should also specify the category of member - elected or nominated. The Committee, accordingly, recommended that the following definition of ‘member’ may be inserted after clause (e) in section 2(1) of the Principal Act:-

‘(ea) “Member” means any member of the Central Council, elected or nominated and includes President

or Vice-President.’

12.159 The Committee felt that this provision was adequate and experts were getting due representation under this clause. The Committee, therefore, recommended that clause-3 of the Bill proposing to insert clause (d) in section 3(1) of the Principal Act may be deleted.

12.160 The Committee took note of very serious reservations expressed by not only the office-bearers of the Central Council, but also by some experts who appeared before it. The Committee was inclined to agree with their views that dissolution of a primarily elected body of professionals and experts could not be considered democratic. The Committee was given to understand that besides some members of the existing Council having completed their term, it also consists of some members yet to complete their term. 12.161 The Committee was informed that election was to be conducted in 23 States/UTs for 34 seats including those in the defaulting states of Bihar and Maharashtra where elections were last conducted in 1989-90. Despite funds being provided for conducting elections and Returning officers being appointed, elections remained to be held. The Committee found that election process for the Central Council had been initiated since 2002 with Gazette Notifications dated 13.7.02, 3.3.03, 13.11.03, 26.3.04, 6.5.04, 22.11.04 and 1.4.05 being issued. The Committee was of the firm opinion that appointment of Board of Administrators would not serve any purpose for the very reason that existing election process was a prolonged affair. The Committee, therefore, recommended that proposed clause 3 A may be deleted. 12.162 The Committee also felt that fixed term of five years for the members and office- bearers of the Council and withdrawing the option of continuing beyond their term by virtue of their successor not being elected or nominated would be the ideal position. The Committee was, however, not inclined to agree with the contention of the Department that fixed term of five years would ensure timely election of the Council. The Committee failed to understand as to how the members would be in a better position to influence the State Councils/ Boards for updating of State Registers - a pre-requisite for conducting timely elections. The Committee emphasized that as per Section 4 of the Principal Act elections to the Council were to be conducted by the Central Govt. However, the history of the Council, since its constitution through nomination in 1974, clearly indicated that the Central Govt. failed in its statutory duty. First elections to the Council could be conducted only in 1989-90, followed by next elections during 1996-98. The Committee found that although steps were initiated for conducting elections in 2001, elections were yet to be conducted in 23 States/ UTs for 34 seats.

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12.163 The Committee did not foresee any significant improvement in spite of Central Govt. being bound to take necessary steps for the reconstitution of a new Council at least threes months before the expiry of term of the Council as indicated in the proviso to substituted section 7 (1). The Committee felt that the period of three months was not enough for the Central Govt. to complete the procedural formalities for reconstitution of the Central Council. The Committee also felt that the involvement of the Council in the election process would expedite the same. The Committee, therefore, recommended that the Central Govt., in consultation with the Central Council, should initiate the process of reconstitution of Central Council at least six months before the expiry of the term of the Council. 12.164 “Where the said term of five years is about to expire in respect of any member, a successor may be elected or nominated at any time within three months before the said term expires but he shall not assume office until the said term has expired” The Committee felt that in view of the proposed substitution of section 7(1) of the Act, the above provision had become redundant. The Committee, accordingly, recommended that the same may be deleted. 12.165 The Committee felt that election/nomination should be notified without any delay. It would be appropriate if the term of the member starts from the date of notification of his election/nomination. The provision may be amended accordingly. 12.166 The Committee felt that the Central Council which was a democratically elected body, having eminent experts in their respective fields as its members could not be substituted by the nominees of the Central Govt. even for a temporary period of six months. The Committee emphasized that with the proposed substitution of section 7(1) providing a fixed term for members and Committee’s recommendation for starting the election process six months in advance, any eventuality of a Board of Administrators running the Council should not arise. The Committee would also add that Govt. should instead take all necessary measures for expediting the election process so as to ensure its completion within six months. 12.167 While upholding the democratic rights of members of the Council the Committee felt that functioning of the Council should not be allowed to remain under the control of a selected few. The Committee, therefore, recommended that instead of two terms, a member should be allowed to hold office for three terms. The proviso may be amended accordingly.

12.168 The Committee felt that required infrastructure and faculty members were the most rudimentary requirements of all Homoeopathy Medical Colleges, be it new or old. Therefore, it should be ensured that the standard of education in the Homoeopathy Medical Colleges is maintained. The Committee, however, felt that the grace period of three years sought to be given to the existing colleges to improve themselves and come at par with new colleges was too long, which may lead to adversely affecting the career of students. The Committee, accordingly, recommended that grace period of only one year should be given. Proposed section 12 C may be accordingly modified. 12.169 The Committee observed that this provision was required to be invoked in case of some irregularity or unwanted activity on the part of the President or the Vice-President or any member. The Committee, therefore, agreed to the proposed addition. The Committee, however, had reservations about the provisions of sub-clauses (3) and (4) whereunder powers and duties of Vice-President since removed were to be exercised and performed by a person to be appointed by the Central Govt. Period of three months was provided for election of the new President or Vice-President or any member. The Committee was of the opinion that the provision regarding Central Govt. having the powers to impose any outsider although eligible to be a member of the Council as the Vice-President will go against the Central Council, an elected body. The Committee, therefore, recommended that the Vice-President should be elected by the members from amongst themselves. The Committee also recommended that instead of three months, a period of one month would be adequate for election of new President or Vice-President or any member. Proposed sub-sections (3) and (4) of new sub-section 30A may, accordingly, be modified. 12.170 The Committee did not agree with the submission of the Department that there was a need for having a provision for withdrawal and removal of nominated members in case they commit some misconduct or unwanted activity. The Committee was of the opinion that such a provision will prove to be discriminatory for nominated members. The Committee also apprehended that members nominated by the Central Council may become pawns in the hands of the Central Government. Therefore, for the purpose of maintaining the

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independent status of the Council, the Committee recommended for the deletion of the above provision from the Bill. 12.171 The Committee was of the opinion that making it obligatory for the Central Council to be guided by directions given in ‘ public interest ‘ by the Central Govt. may lead to undue interference in the working of the Council which was a duly elected body whose decisions were collective, based on majority of votes. The Committee observed that section 30 of Principal Act already provided for a Commission of Inquiry to be setup by the Central Govt. to probe any action of the Council contrary to the provisions of the Act. The Committee, therefore, recommended deletion of proposed section 30 C. 12.172 The Committee strongly felt that an elected body could not be dissolved by an Executive order. Further, imposition of persons in spite of them being from amongst the members of the Council as proposed under section 30 D (2) (b) would be clearly at the discretion of Central Govt. Thus, for a period of six months, Central Govt would be virtually running the Council. The Committee apprehended that instances may be there when Central Govt. may assume such powers more than once during the term of a Council. Thus, an atmosphere of confrontation may prevail which will be against the larger interests of all concerned. The Committee pointed out that Govt. nominees were already represented in the Council and various Committees under Section 3 (C) of the Principal Act. Not only this, there also existed a provision for setting up a Commission of Inquiry under Section 30 where by the Central Govt. had the powers to refer any case of non-compliance by the Council to a Commission of inquiry for investigation and follow up action. 12.173 The Committee felt that the provision of Commission of Enquiry as mentioned in Section 30 was sufficient to check the misuse of power/ successive default by any Committee of the Council and there was no further need to give the Government powers which were susceptible to be misused. The Committee, therefore, recommended for deletion of this provision from the Bill. 12.174 The Committee was of the view that the above provision gives unfettered powers to the Government, which could be used to interfere with the autonomous functioning of the Council. The Committee also noted that there already existed section 30 in the Principal Act which provided for the constitution of a Commission of Inquiry by the Central Govt. to enquire into the cases of alleged misconduct by the office bearers of the Council/ member of Committee. Besides that, with the proposed section 30A with amendments as suggested by the Committee, action can be taken by the Central Council based on a resolution passed by majority of membership of the Central Council. 12.175 The Committee therefore felt that there was no need to insert Section 30 E in the Principal Act, as proposed by the Bill and the same may be deleted. 12.176 The Committee was, however, not convinced by the contention of the Department. The Committee pointed out that under section 32 of the Principal Act, the Central Govt was already empowered to make rules to carry out the purposes of the Act. Section 33 provides that the Central Council, with the previous sanction of the Central Govt. may make regulations necessary for its functioning. The Committee failed to understand the justification for assumption of over-riding powers by the Central Govt. as against the powers given to the Central Council, an elected body which will be making /amending/revoking regulations with the previous sanction of the Central Govt. The Committee therefore, recommended the deletion of section 34 sought to be incorporated in the Principal Act. 12.177 The Committee adopted the remaining clauses of the Bill, including the enacting formula and the title without any amendment. 12.178 The Committee expressed its serious concern on non-adherence to a well-established convention of consultation with all the Stake-holders for bringing out any legislation or proposed amendments thereto. Clarification made by the Department that unwarranted action of the Council has resulted in the proposed legislation for amendment of the Act clearly indicated that this non-initiative was deliberate on the part of the Department. 12.179 The Committee noted that the election to the Homoeopathy Central Council was conducted by the Central Govt. as per the provision of the relevant Rules. The Returning Officer was appointed by the Central Govt. on the recommendation of State Govt. The Voters List was to be provided by the Registrar, State Board/Council. Non-appointment of Returning Officer, frequent change of Returning Officers by State Govts. due to retirement/transfer/death of incumbents, non-provision of updated State Registers by State

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Registrars, Court cases, difficulty in determination of seats etc. are some of the constraints being faced by the Central Govt. in the conduct of elections to both the Councils. 12.180 The Committee observed that the election process for the Central Council was a prolonged affair, depending upon timely appointment of Returning Officers and availability of Updated Registers. The Committee failed to understand in what manner, Central Govt. would manage and expedite the election process of the Central Council under the existing provisions. The Committee was of the view that there was an urgent need for review of the existing system, specially in view of the present circumstances. Proposed amendments to the Act governing the functioning of the Central Council will neither result in timely appointment of Returning Officers nor in timely updating of State Registers. The Committee felt that there was an urgent need for review of the existing procedure for election to the Central Council and taking required steps for streamlining the same. The Committee, accordingly, recommended that the Central Govt. in consultation with the Central Council and experts may initiate action. 12.181 The Committee observed that under the present setup, State Boards/Councils were not controlled by the Central Council. They were also not accountable to Central Govt. As a result, by and large, State Councils were not adhering to the prescribed norms for updating of State Registers, essential for holding elections to the Councils. Non-submission of consolidated list of practitioners, non-removal of names of expired practitioners, submission of incomplete lists with regard to State Registers were some of the shortcomings brought to the notice of the Committee. State Councils were also defaulting in the proper and timely appointment of Returning Officers. The Committee apprehended that after enacting the present legislation, there would not be any significant improvement. The Committee was of the firm opinion that a mechanism had to be evolved where under Central Council and State councils work in coordination, complementing the functioning of each other and the State Councils should function under the former. The Committee, therefore, recommended that the Department should work out a legally and practically viable set up for the purpose. 12.182 The Committee was disturbed to note the discrepancy between the information given by the office-bearers of CCH and the Department. The Committee would like to have the factual position about the status of the Commission of Inquiry. (Para 13.7) 12.183 The Committee, however, observed that, in respect of CCH, out of 76 pending cases, only two cases relate to election matters. Generally cases pertain to matters regarding opening of new colleges, increase in seat intake capacity, service matters etc. Thus, the Committee was not inclined to accept the contention of the Department that due to litigation and stay orders by Court, elections to the Council got delayed. (h) 11th Report 12.184 The Committee felt that the definition should also specify the category of member-whether elected or nominated. The Committee, accordingly recommended that the following definition of “member” may be inserted after clause (f) in section 2(1) of the Principal Act - ‘(fa) “Member” meant any member of the Central Council, elected or nominated and includes President or Vice-President.’ 12.185 The Committee noted that as provided in section 9 of the Principal Act, there were three Committees for Ayurveda, Siddha and Unani and Vice- President for each system of Indian Medicine shall be the Chairman of each Committee. The Committee felt that the definition of Vice-President should be specific and accordingly recommended the following definition :- ‘(l) “Vice-President” meant a Vice-President of the Central Council who were also Chairman of Ayurveda, Unani and Siddha Committee respectively.’ 12.186 The Committee, however, observed that Section 3 (c) of the Principal Act already empowered the Govt. to nominate 30% of the total number of the members elected under clauses (a) and (b) of Section 3 (I) from amongst persons having special knowledge or practical experience in respect of Indian Medicine. The Committee felt that this provision was adequate and experts are getting due representation under this clause. The Committee, therefore, recommended that clause 3 proposing to insert clause (d) in Section 3 (1) of the Act may be deleted. 12.187 The Committee took note of very serious reservations expressed by not only the office bearers of the Central Council but also by some experts who appeared before it. The Committee was inclined to agree with

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their views that dissolution of a primarily elected body of professionals and experts could not be considered democratic. The Committee had been given to understand that some of the members had been elected to the Council recently in accordance with the due process of elections. The Committee, therefore, recommended that the proposed section 3 A may be deleted. 12.188 The Committee also felt that fixed term of five years for the members and office-bearers of the Council and withdrawing the option of continuing beyond their term by virtue of there successor not being elected or nominated would be the ideal position. The Committee was, however, not inclined to agree with the contention of the Department that fixed term of five years would ensure timely election of the Council. The Committee emphasized that as per section 4 of the Principal Act, elections to the Council were to be conducted by the Central Govt. However the history of the Council since its constitution through nomination of members in 1971 clearly indicated that the Central Govt. failed in its statutory duty. First elections to the Council could be conducted only in 1983-84, followed by next elections in 1994-95. The Committee found that although tenure of all the members expired in 2000, electoral process had been completed only in 11 out of 18 states maintaining State Register. 12.189 The Committee did not foresee any significant improvement inspite of Central Govt. being bound to take necessary steps for the reconstitution of a new Council at least three months before the expiry of the term of the Council. The Committee felt that the period of three months was not enough for the Central Govt. to complete the procedural formalities for reconstitution of the Central Council as indicated in the proviso to substituted section 7(1). The Committee also felt that involvement of the Council in the election process would expedite the same. The Committee, therefore, recommended that the Central Govt. in consultation with the Central Council should initiate the process of reconstitution of Central Council at least six months before the expiry of the term of the Council. 12.190 The Committee felt that in view of proposed substitution of section 7(1) of the Act, the above provision has become redundant. The Committee, accordingly, recommended that the same may be deleted. 12.191 The Committee agreed with the above submission and recommended that Section7 (1) should be amended accordingly. 12.192 The Committee felt that the Central Council, which was a democratically elected body having eminent experts in their respective fields as its members could not be substituted by the nominees of the Central Govt. for a temporary period of six months. The Committee emphasized that with the proposed substitution of section 7 (1) providing a fixed term for members and committee’s recommendation for starting the election process six months in advance, any eventuality of a Board of Administrators running the Council should not arise. The Committee would also add that Govt. should instead take all necessary measures for expediting the election process so as to ensure its completion within six months. The Committee therefore recommended that the sub-clause (1A) of the Bill may be deleted. 12.193 While upholding the democratic rights of the people, the Committee also felt that functioning of the Council should not be allowed to remain under the control of a selected few. The Committee, therefore, recommended that instead of two terms, a member should be allowed to hold office for three terms. Proviso may be amended accordingly. 12.194 The Committee observed that this provision was required to be invoked in case of some irregularity or unwanted activity on the part of the President or the Vice-President or any member. The Committee, therefore, agreed to the proposed addition. The Committee, however, had reservations about the provisions of sub-sections (3) and (4) whereunder powers and duties of Vice-President since removed were to be exercised and performed by a person to be appointed by the Central Govt. Period of three months was provided for election of the new President or Vice-President or any member. The Committee is of the opinion that the provision regarding Central Govt. having the powers to impose any outsider, although eligible to be a member of the Council, as the Vice-President would go against the Central Council, an elected body. The Committee, therefore, recommended that the Vice-President should be elected by the members from amongst themselves. The Committee also recommended that instead of three months, a period of one month would be adequate for election of new President or Vice-President or any member. Proposed sub-sections (3) and (4) of new sub-section 33A may, accordingly, be modified. 12.195 The Committee does not agree with the submission of the Department that there was a need for having a provision for withdrawal and removal of nominated members in case they commit some misconduct or

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unwanted activity. The Committee was of the opinion that such a provision would prove to be discriminatory for nominated members. The Committee also apprehended that members nominated by the Central Council may become pawns in the hands of the Central Government. The Committee pointed out that under the proposed Section 33 A, Central Council would be having the power for removal of a member. Therefore, for the purpose of maintaining the independent status of the Council, the Committee recommended for the deletion of the above provision from the Bill. 12.196 The Committee was of the opinion that making it obligatory for the Central Council to be guided by directions given in ‘ public interest ‘ by the Central Govt. may lead to undue interference in the working of the Council which was a duly elected body whose decisions are collective, based on majority of votes. The Committee observed that section 33 of Principal Act already provided for a Commission of Inquiry to be setup by the Central Govt. to probe any action of the Council contrary to the provisions of the Act. The Committee, therefore, recommended deletion of the proposed section 33 C. 12.197 The Committee strongly felt that an elected body could not be dissolved by an Executive order. Further, imposition of persons in spite of them being from amongst the members of the Council as proposed under section 33 D (2) (b) would be clearly at the discretion of Central Govt. Thus for a period of six months, Central Govt. would be virtually running the Council. The Committee apprehended that instances may be there when Central Govt. may assume such powers more than once during the term of a Council. Thus, an atmosphere of confrontation may prevail which will be against the larger interests of all concerned. The Committee pointed out that Govt. nominee were already represented in the Council and various Committees under Section 3 (C) of the Principal Act. Not only this, there also existed a provision for setting up a Commission of Inquiry under section 33 whereby the Central Govt. had the powers to refer any case of non-compliance by the Council to a Commission of Inquiry for investigation and follow up action. 12.198 The Committee felt that the provision of Commission of Inquiry as mentioned in Section 33 was sufficient to check the misuse of power/ successive default by any committee of the Council and there was no further need to give the Government powers which are susceptible to be misused. The Committee, therefore, recommended for deletion of this provision from the Bill. 12.199 The Committee was of the view that the above provision gave unfettered powers to the Government, which can be used to interfere with the autonomous functioning of the Council. The Committee also noted that there already existed section 33 in the Principal Act which provided for the constitution of a Commission of Inquiry by the Central Govt. to enquire into the cases of alleged misconduct by the office bearers of the Council/ member of Committee. Besides that, with the proposed section 33A with amendments as suggested by the Committee, action can be taken by the Central Council based on a resolution passed by majority of membership of the Central Council. 12.200 The Committee, therefore, felt that there was no need to further insert section-33 (E) in the Principal Act, as proposed by the Bill and the same may be deleted. The Committee failed to understand the justification for assumption of overriding powers by the Central Govt. as against the powers given to the Central Council, an elected body which will be making/amending/revoking regulations with the previous sanction of the Central Govt. The Committee therefore recommended the deletion of section 37 sought to be incorporated in the Principal Act.

12.201 The Committee adopted the remaining clauses of the Bill, including enacting formula and the title without any amendment.

12.202 The Committee expressed its serious concern on non-adherence to a well-established convention of consultation with all the Stake-holders for bringing out any legislation or proposed amendments thereto. Clarification made by the Department that unwarranted action of the Council has resulted in the proposed legislation for amendment of the Act clearly indicates that this non-initiative was deliberate on the part of the Department. 12.203 The Committee noted that the election to the Central Council of Indian Medicine was conducted by the Central Govt. as per the provision of the relevant Rules. The Returning Officer was appointed by the Central Govt. on the recommendation of State Govt. The Voters List was to be provided by the Registrar, State Board/Council. Non-appointment of Returning Officer, frequent change of Returning Officers by State Govts. due to retirement/transfer/death of incumbents, non-provision of updated State Registers by State

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Registrars, Court cases, difficulty in determination of seats etc. were some of the constraints being faced by the Central Govt. in the conduct of elections to both the Councils. 12.204 The Committee observed that the election process for the Central Council was a prolonged affair, depending upon timely appointment of Returning Officers and availability of Updated Registers. The Committee failed to understand in what manner, Central Govt. would manage and expedite the election process of the Central Council under the existing provisions. The Committee was of the view that there was an urgent need for review of the existing system, especially in view of the present circumstances. Proposed amendments to the Act governing the functioning of the Central Council will neither result in timely appointment of Returning Officers nor in timely updating of State Registers. The Committee felt that there was an urgent need for review of the existing procedure for election to the Central Council and taking required steps for streamlining the same. The Committee, accordingly, recommended that the Central Govt. in consultation with the Central Council and experts may initiate action. 12.205 The Committee observed that under the present setup, State Boards/Councils were not controlled by the Central Council. They were also not accountable to Central Govt. As a result, by and large, State Councils were not adhering to the prescribed norms for updating of State Registers, essential for holding elections to the Councils. Non-submission of consolidated list of practitioners, non-removal of names of expired practitioners, submission of incomplete lists with regard to State Registers were some of the shortcomings brought to the notice of the Committee. State Councils were also defaulting in the proper and timely appointment of Returning Officers. The Committee apprehended that after enacting the present legislation, there would not be any significant improvement. The Committee was of the firm opinion that a mechanism had to be evolved where under Central Council and State councils work in coordination, complementing the functioning of each other and the State Councils should function under the former. The Committee, therefore, recommended that the Department should work out a legally and practically viable set up for the purpose. 12.206 The Committee, however, observed that as per details of 106 pending Court cases in respect of CCIM by the Department itself, no case is regarding election matters. Generally cases pertain to matters regarding opening of new colleges, increase in seat intake capacity, service matters etc. Thus, the Committee was not inclined to accept the contention of the Department that due to litigation and stay orders by Court, elections to Councils may get delayed. (i) 12th Report 12.207 The Committee was in agreement with the view point of the Ministry that the enhancement in penalty under Section 27 of the Act would act as a deterrent for offenders. 12.208 The Committee felt that prolonged illness might occur due to a variety of reasons. There may be cases where doctor inadvertently or deliberately may be responsible for delay in getting the patient cured. However, if it is due to use of adulterated or spurious drugs, then this aspect needs to be looked into. The Committee, accordingly, recommended that the Department may explore the possibility of bringing such cases under Section 27 (a).

12.209 The Committee noted that Section 16 and second schedule specifics the standard of quality to be maintained by drugs. In the case of patent or proprietary medicines, the list of ingredients was to be displayed in the prescribed manner on the label or container. In the case of vaccines, sera, toxins, toxoids, antitoxins, antigens and biological products of like nature, standards were to be maintained by the labs recognized by WHO from time to time. The Committee was of the view that any deviation in the prescribed standards of medicines was equally serious when compared with adulterated and spurious drugs and needs to be treated at the same footing. 12.210 The Committee was not convinced with the reply and feels that the Department, perhaps, had not addressed the issue appropriately. Apprehensions were also voiced about the chance of conflict in the event of there being more than one claimant being covered by the term ‘relative’. There was thus a need for categorizing the same. 12.211 The Committee, accordingly, recommended that parents of infant victim should be covered under the definition of “relative” very explicitly so that the parents in case of such an eventuality are not deprived of their right of compensation.

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12.212 Definition should also include deserted/divorced sister/daughter-in law and mother instead of only widowed mother. The Committee was convinced by the clarification of the Department that it should be left to the court of law to decide the bona fide recipient and the quantum of compensation to be paid to him/ her.

12.213 These clauses propose to enhance the penalty under Section 27 (b), (c) and (d), 28 and 28A of the Act. The Committee was in agreement with these amendments and, accordingly, adopted these clauses. 12.214 The Committee failed to understand the rationale for deletion of this clause, especially whereas all other penalties under the other provisions under Chapter IV were proposed to be enhanced. Chapter IV dealt with manufacture, sale and distribution of drugs. Section-33 under this Chapter related to the rules making power of the Central Government which include very vital subjects, for example, establishment of labs, methods of test/ analysis of drugs, qualification/duties of Govt. Analysts/ Inspectors, prohibition of sale/ stocking/exhibition for sale/ distribution of drugs after the expiry date/specification of offence regarding which order of confiscation was required to be made etc. As per Section 30 (c), penalty for subsequent offence was more stringent when compared with penalty for first offence under Section 27 (d). The Committee, therefore, was of the view that Section 30 (c) should not be deleted and penalty for subsequent offence in Section 30 (c) should be suitably enhanced.

12.215 The Committee noted that Clause 5 also proposes deletion of Sub-Section (2) of Section 30. This Sub-Section related to penalty for subsequent offence of use of Govt. Analysts report for advertising. Penalty for subsequent offence was higher then the penalty for the first offence i.e. against a fine for Rs. 500/- penalty for subsequent offence was maximum imprisonment of ten years or with fine or with both. No justification had been given by the Department for deletion of this Sub-section. The Committee, therefore, recommended that the Department should review this amendment.

12.216 The Committee also felt that a police officer or an officer of the Central Government or State Government do not have the required professional qualification to handle drug-related cases. Therefore, for the purpose of proper prosecution, involvement of Drug Licensing Authority was necessary. The Committee, therefore, recommended that in case of prosecution by the police inspector or Govt. Officer, prior permission of the Drug Licensing Authority of the concerned area should be made a precondition. 12.217 The Committee concurred with this view and recommended the Department to amend Section 32 B in the light of the above observation. 12.218 The Committee, however, was not inclined to believe that mere designation of one or more courts of Sessions as Special Court will help in expeditious disposal of cases as the Sessions Courts were already overburdened with a large number of cases. The Committee, therefore, recommended that new courts need to be set up for the purpose of trying offences under the Drugs & Cosmetics Act. 12.219 The Committee adopted the remaining clauses of the Bill, including enacting formula and the title without any amendment. 12.220 The Committee, therefore, thought that in order to realize the deterrent-effects of the proposed Bill, first of all a successful conviction in the court of law is necessary and for that to happen it should be ensured that the accused was prevented from manipulating the system to his advantage. The Committee also felt that peddling in spurious or adulterated drugs was no way less serious than peddling in narcotics. The Committee, therefore, recommended that the Department should incorporate similar provisions in the Bill, as exists in the NDPS Act. 12.221 The Committee emphasized that action to increase public awareness about harmful/banned drugs should be initiated at the earliest. 12.222 The Committee hoped that with all these measures the situation would improve in the states. 12.223 The Committee found it rather surprising. The Committee strongly felt that the Department had to take in the initiative in this matter. An effective monitoring mechanism needed to be set up to present such cases. At the same time, public should also be made aware of such provisions.

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12.224 The Committee however felt that more stringent penalties were required to be imposed in the case of spurious/adulterated/ not of standard quality Ayurvedic/Unani/Siddha drugs also. The Committee, therefore, was of the view that the penalty provision for AYUSH drug should be reviewed so as to make changes, if necessary. The Committee also emphasized the need for strengthening the testing labs for AYUSH drugs, the present status of which cannot be considered satisfactory.

(j) 13th Report

12.225 The Committee was not inclined to fully accept the clarification given by the Department. The Committee’s attention had been drawn by a World Bank study ‘Country Strategy for India- September, 2004’ which has raised doubts about the reliability of Maternal Mortality Rates (MMR)). Annual Report of the Department for 2004-05 also accepts this fact. The Committee had noted that an expert group constituted in the Department is looking into the modalities for carrying out a survey for collection of data on maternal mortality. The Committee hoped that the expert group may have given its report. The Committee wanted to be apprised about the factual position in the matter. 12.226 The Committee noted that the National Rural Health Mission had been launched in the country with a special focus on 18 socio-demographically weaker states. The goals in terms of health care indicators have been fixed for the period 2005-2012 on yearly basis. While appreciating that district specific action was envisaged under NRHM, the Committee felt that target achievement would not be a simple task in view of very low status of child health in some states. This area of concern also found a place in the Mid-Term Appraisal of the Tenth Plan as indicated below: - Infant and New Natal Mortality Rates (Per 1000 live birth)

Year Bihar M.P U.P Orissa 2000 (IMR) 62 87 83 95 2002 (IMR) 61 85 80 87 2002 (NMR) 37 57 47 53

12.227 The Committee was of the view that success of National Rural Health Mission lay in significant improvement in health status of both mother and child in bad performing states. The Committee, however, was constrained to observe that the Department was still in the process of developing a systematic integrated monitoring system for NHRM. The Committee pointed out that constant monitoring at all levels by a dedicated team alone could bring about a change in the present discouraging scenario. This could only be achieved if an element of accountability was also included in the programme. 12.228 The Committee expressed its serious concern over the justification given by the Department for reduction of allocated funds at the Revised Estimates stage and those reduced funds remaining under utilized. The Committee observed that non-availability of utilization certificates due from user states and bookings of various items only after confirmation of their reaching the consignees had been cited as the two main factors. The Committee strongly felt that these procedural problems could easily be resolved if a sincere effort was made. Regular monitoring at all levels and streamlining of accounting procedure could be the simple remedies.

12.229 The Committee was more concerned with the reason given for under-utilization of funds already reduced at the RE stage. NE Region has been held responsible for such a situation. The Committee, however, pointed out that NE Region comprised of states which are located in the remotest corner of the country and are having very unsatisfactory health indictors when compared with the national average. The Committee felt that urgent action needed to be taken for improving the less than 50% utilization position of allocated funds, already reduced at the RE stage. The Department had admitted that the norm based funding of different schemes restricts the expenditure in NE Region to significantly less than the target. The Committee was of the view that norms need to be made State specific keeping in view their special requirements especially for backward population and inaccessible areas. 12.230 The Committee noted that a number of measures had been initiated by the Department under NRHM for elimination of unspent balances lying with different states. The Committee appreciated the streamlining of existing accounting procedure. The Committee hoped that with the nodal officers in place things would improve and result in both better utilization of funds and implementation of schemes.

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12.231 The Committee found that to achieve better results under NRHM, some of the ongoing programmes of the Department of Health & Family Welfare in the states have been merged. The main idea behind such a move was to have better monitoring, utilization of funds and better service providing. New posts have been created. The Committee, however, reiterated its earlier observation made in this regard. An effective monitoring mechanism with an inbuilt system of having required follow up action should be the most crucial component under NRHM. This is all the more required due to convergence of the two Departments. 12.232 The Committee expressed its serious concern over the dismal achievement made by majority of states in establishing new Sub-Centres during the Tenth Plan. Against a target of 8669 Sub-Centres, only 2909 Sub-Centres could be set up so far. Rajasthan, Nagaland, Punjab and West Bengal were the only States which have succeeded in achieving their targets. In contrast, in respect of States like Bihar and Chattisgarh, details of Sub-Centres set up were not available with the Government although fourth year of the Tenth Plan is nearing its end. Similarly, Meghalaya, Orissa, Tripura, U.P and Delhi had failed to set up even a single Sub-Centre. Same was the status of Maharastra which had taken almost four years to set up only two Sub-Centres against a target of 808 Sub-Centres. The Committee failed to comprehend the constraints faced by these States in spite of central assistance available for setting up of Sub-Centres, at a higher level for EAG and NE States. The Committee hoped that under the National Rural Health Mission, all such crucial aspects would be fully taken care of. 12.233 The Committee observed that as on September, 2004 (as per 2001 population), there was a shortfall of 4436 PHCs spread over in different states in the country. The Committee pointed out that the overall figures reveal very disturbing trends. States like Arunachal Pradesh, Himachal Pradesh, J&K, Kernataka, Kerala, Manipur, Mizoram, Orissa, Rajasthan, Sikkim, Tamil Nadu, A&N Islands and Pondicherry had excess number of PHCs. In contrast, States like Bihar, UP and West Bengal were yet to establish a large number of PHCs. Such a situation clearly indicated that norms for setting up of PHCs were not being strictly adhered to by the States. In spite of Central assistance being provided both for establishment of PHCs and provisions of required infrastructure and maintenance some States seem to have failed to take benefit of such assistance. The Department should make concerted efforts in getting the required PHCs established in States. The Committee also strongly felt that there was a need for review of the scheme of health centers in rural areas, by having a more flexible approach. 12.234 The Committee viewed with serious concern the low achievement level of setting up of CHCs in different states in the country. The Committee was informed that the issue of review of existing population norms would be taken up with the Planning Commission. The Committee emphasized that the Department should pursue this matter with the Planning Commission so that population norms for setting up of CHCs were revised without any further delay. The Committee was disturbed by the fact that even those states whose track record about setting up of Sub-Centres and PHCs had been very good, even having excess number of Centres, had shown a dismal performance level of setting up CHCs. The very purpose of having the required/excess number of Sub-Centres and PHCs gets defeated if the required number of CHCs were not there to take care of referral cases from smaller centres. 12.235 The Committee had drawn the attention of the Department towards the findings of an evaluation study of 1040 Sub-Centres covering 300 districts of 14 major states conducted by NCAER submitted on the 22nd November, 2004. The Committee was surprised to note that even after one year of submission of evaluation study recommendations, the same were still in the process of being forwarded to the concerned states. The Committee emphasized that the Department should pursue with the State Govts. the required follow-up action in the light of NCAER evaluation study without any further delay. There was an urgent need for conducting similar evaluation studies of PHCs and CHCs at the earliest, especially in view of the fact that National Rural Health Mission had already been launched. 12.236 The Committee viewed with serious concern the shortfall of 11,191 posts of ANMs in the country. ANM is an important functionary in Health Care delivery system at local level and therefore such a high shortfall of ANMs will adversely affect the system of health care in rural and inaccessible areas. The Committee failed to comprehend the reasons for non-availability of records regarding ANMs in the case of Bihar and Jharkhand. The Committee wanted to be informed about the criteria for release of Central Funds for salary of ANMs to states.

12.237 The Committee recommended that the matter of shortfall in the posts of ANMs both which have not yet been sanctioned and also sanctioned posts yet to be filled up should be taken up with the concerned State

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Govts. so that work in demographically weaker states as well as in the other states progresses at a faster pace.

12.238 The Committee took note of number of initiatives being taken by the Department for elimination of unspent balances with the states and procurement of utilization certificates from the concerned State Govts. The Committee was, however, not convinced by the proposed method of the Department of obtaining refund/adjusting unspent balances against the subsequent withdrawal. Such a move would be directly against the set goals, thus defeating the very objectives of the programme. Desired action would be to motivate the states to utilize the allocated funds as per the Action Plan.

12.239 Committee’s attention was drawn by a number of interventions like contractual appointment of ANMs, Public Health/Staff Nurse/Lab Technicians and hiring of Private Anesthetists/ Gynecologists under RCH phase-I. The Committee had commented about low level of such appointments by different states in spite of considerable central funds being released therefor. The Committee was given to understand that whereas details of appointments have been on yearly basis, details of funds released were on cumulative basis. The Committee was not happy with the kind of information submitted by the Department which has resulted in confusion. The Committee wanted to be apprised about the details of funds released and appointments made under the interventions of RCH phase-I for the first three years of Tenth Plan (year wise). The Committee pointed out that amount of honorarium/contractual salary for different categories also needed to be reviewed so as to attract the required medical personnel.

12.240 The Committee took serious note about lack of response from States/UTs regarding the inspection report of the Central Internal Audit Party (CIAP) mentioning irregularities observed by it. The Committee believed such a practice continued because of improper accountability measures currently in vogue. The Committee was of the view that in such cases, the Department should pursue at the highest level. The Committee felt that the Department should devise adequate measures to increase the accountability of states in the wake of which defaulting States/UTs could be asked for compliance.

(k) 14th Report

12.241 Committee observed that inspite of funds being provided for conducting elections to CCH year after year, elections could not be conducted. The Committee was not satisfied with the justification for delay given by the Department. It seemed that the process of notification for election and appointment of Returning Officers is a very cumbersome procedure as it has taken more than two years to complete this exercise. What is more disturbing is that elections still remained to be conducted, reason being non-maintenance/updation of State Registers of Homoeopathy by the States. The Committee took a serious view of this. The Committee failed to understand the lack of initiative on the part of the CCH/Department in getting the State Registers updated well in time. The Committee was of the view that the Department should take the required steps for streamlining the election procedure for CCH. 12.242 The Committee was given to understand that maintenance of Central Register of Indian Medicine and updating of the same is a continuous process. The Committee, however, was constrained to note that out of the eighteen States having State Boards, as on 31.03.05, Gujarat is the only State whose state Register is updated upto January, 2005. In the case of rest of the States, pendency ranges from March 1983 in J&K to August [2004 in Delhi. Pendency in the State Registers has an adverse effect on the maintenance of Central Register. The Committee therefore impressed upon the Department to vigorously pursue with the State Government the updation of the State Registers. With regard to Central Register of Homoeopathy, CCH was required to get renewed the registers after every eight years. The Committee found that in respect of majority of States, renewal had become due but it seemed no action had been initiated so far. The Committee urged upon the Department to take the required action without any further delay. The Committee also observed that Central Register of Homoeopathy cannot be considered updated in any respect. It covered varying period from 1982 to 2004 in respect of different states. It seemed Gazette Notifications were also being issued after a long time-gap. Procedural formalities might be responsible for such a situation. The Committee firmly opinioned that entire procedure of maintenance and updation of both State and Central Registers for Indian Medicine and Homoeopathy needed to be reviewed so as to ensure its timely publication. 12.243 Committee had drawn the attention of the Department to there being no check on practice by non-qualified doctors and quacks. Reply of the Department, however, did not give any idea about the existence of

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any monitoring mechanism either at State or Central level. The Committee reiterated that there is an urgent need for taking an initiative by the Department in this area. Such a move would go a long way in curbing the unauthorized practice by AYUSH doctors and also increasing the faith of general masses in the traditional system of medicine. 12.244 Committee’s attention was drawn by the very slow progress made in the construction work of the building the of Regional Research Institute of Unani Medicine, Srinagar. The Committee understood that disturbances in the valley and shortage of funds are primarily responsible for this situation. The Committee was, however, not fully convinced by the justification given in this regard by the Department. The Committee found that not much progress seemed to have been made in the construction of the building of RRIUM, Srinagar. The Committee had made a specific query about the original estimate and the actual expenditure on the project. The Committee was given to understand that against an original estimate of Rs. 6.08 crore submitted by CPWD, total estimated expenditure now stands at Rs. 4.87 crore for the construction of the building undertaken by the Kashmir University. An amount of Rs. 4.37 crore has been released so far. The Committee’s specific query about the actual expenditure on the project remains unanswered. The Committee is still not aware about the present status of the buildings of RRIUM, Srinagar. The Committee would like to be apprised in this regard. 12.245 The Committee was informed that following two surveys have been conducted by ICMR during the Tenth Plan- - Survey on ‘Usage and Acceptability of ISM&H- final Report submitted in August, 2003 - Survey on ‘AYUSH beneficiaries covered under CGHS and selected Teaching hospitals attached to AYUSH Medical Colleges- draft report approved by the Department and final Report awaited

The Committee was given to understand that delay in submission of Reports was primarily due to involvement of a number of States and other field agencies in the survey work. The Committee wanted to be apprised about the follow-up action taken, if any, on the first survey mentioned above.

12.246 The Committee had been commenting on the slow progress being made in the project for construction of building of All India Institute of Ayurveda, New Delhi. Latest feedback received from the Department indicates that during 2005-06 also uptill now, only procedural formalities are being completed, real construction is yet to start. The present status is that draft EFC Memo along with Detailed Project Report has been sent to the Planning Commission and Department of Expenditure on 24.6.05. Since then, Department is awaiting their comments, after receipt of which, EFC meeting would be held. The Committee did not have much faith in the Department’s expectation of the project being completed within the anticipated cost of Rs. 325.00 crore. The Committee reiterated that the Department should vigorously pursue the completion of all procedural formalities required for commencing the construction of the building of All India Institute of Ayurveda, New Delhi. 12.247 The Committee was dismayed to note the very slow progress being made in making AYUSH dispensaries in CGHS functional. Out of the seven dispensaries sanctioned in 2003-04, only three could be made functional. The Committee was not inclined to accept the claim of the Department that the three AYUSH dispensaries at Trivandrum, Guwahati and Delhi were now functional. Deployment of medical officers from the existing strength of CGHS dispensaries could only be considered as a stop-gap arrangement. It seemed that process of new recruitment and revival of old posts continued to be impeded by procedural formalities. The Committee, therefore, recommended that the Department should take some concrete steps to make AYUSH dispensaries functional at the earliest so as to increase the usage and acceptability of AYUSH system. 12.248 The Committee was constrained to observe that not much progress was made in 2005-06 so far with regard to creation of posts for the National Medicinal Plant Board. Creation of three posts and outsourcing of three posts for the Board agreed to by the Department of Expenditure is yet to get the formal sanction. Latest position in this regard is that comments of concerned Departments on the EFC note for sanction of requisite posts are awaited. The Committee was not aware whether the Board could be made fully functional with the approved six posts which includes one post of Driver and Messenger also. The Committee reiterated that the Department should expedite the process for creation of six posts. The Department may also make an assessment about the actual requirement of manpower for the Board and pursue the same with the Planning Commission/Department of Expenditure.

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12.249 The Committee viewed with serious concern the state of affairs in both the Labs; i.e. HPL and PLIM. The Committee was given to understand that the buildings for HPL and PLIM would be ready by February, 2005. However, the date for completion again shifted to June-July –2005 and as per the latest information, the buildings were to be ready in all respects with all mandatory certificates by October, 2005. The Committee was not aware about the latest status but hoped that targets must have been achieved. Also, as regards the proposal for creation of posts, the Committee had opined that the Department should not only submit the modified proposal to the Department of Expenditure at the earliest but also pursue the same so as to get it arrive of the logical conclusion. All efforts should be made to get the post of Director, PLIM and HPL filled up urgently. The Committee had hoped that the Department would work towards removing all bottlenecks in the whole process because the objective of these Labs i.e. laying down the standards for drugs of AYUSH and also for their testing/analysis is of immense importance for users.

12.250 The Committee was happy to note that two statutory bodies under the Drugs and Cosmetics Act, i.e. Ayurveda, Siddha, Unani Drug, Technical Advisory Board and Ayurveda, Siddha, Unani, Drug Consultative Committee have been constituted by the Department. ASUDCC will be meeting every six months, with all the State Drug Controllers participating. This Committee would take care of all aspects of ASU(Ayurveda, Siddha and Unani) drugs and would also initiate preventive / deterrent action whenever required. The Committee hoped that these two statutory bodies would be activated at the earliest.

12.251 The Committee was given to understand that drug quality control is the responsibility of the Drug Controller General of India (DCGI) and the state licensing authorities. The Committee, however, pointed out that as per the Annual Report of the Department for 2004-05 Drug Control Cell in the Department is also involved in the control of misbranded/ adulterated and spurious drugs of AYUSH, besides other matters. It seemed that this Cell had not been handling the cases of misbranded/adulterated and spurious drugs so far. If not, the Committee wanted to be apprised about the work done by the Cell during last two years. The Committee noted that the Department now proposes to get the post of Additional Drug Controller (AYUSH) and four Drugs Inspectors (AYUSH) revived and filled up to assist the DCGI in the task of quality control of AYUSH drugs. The Committee emphasized that the Department should take all the required steps to implement the proposal at the earliest.

12.252 The report of scientists of USA mentioning the presence of metals in Ayurvedic/Herbal Medicinal products more than permissible limits is directly related to the efficacy and credibility of Ayurvedic medicines. The Committee appreciated that the Department had initiated a study to see the toxicity/safety profile of metal based bhasmas. A project to estimate the presence of various metals in normal habitat in raw drugs and classical Ayurvedic formulations has also been started. The Committee felt that findings of the study/project would be available after some time only. However, it seems that Harvard Medical Association had not been kept informed about the follow-up action taken by the Department. If that be so, the Committee impressed upon the Department to do so without any further delay. Feed back from the manufacturing companies should also be expedited. (l) 15th Report 12.253 Committee’s attention had been drawn by a disturbing trend of allocation of funds for some premier institutions under the Ministry. The Committee viewed with serious concern the non-provision of required non-Plan funds essential for the smooth functioning of prestigious institutions like AIIMS, PGIMER, Chandigarh, NIMHANS, and Bangalore and similarly placed many other institutions. The Committee had been given to understand that Ministry’s efforts to convince the Ministry of Finance in this regard for the past few years have proved futile. This was indeed a sorry state of affairs. Diversion of funds from Plan to non-Plan on a regular basis should not be allowed to continue, simply because it had an adverse fall-out on the Plan Schemes. The Committee accordingly reiterateed that the department should take it up once again with the Ministry of Finance and prevail upon them for getting the required non-Plan funds from 2005-06 itself. 12.254 The Committee noted that although three new CGHS allopathic dispensaries one each at Bhubaneswar, Ranchi and Dehradun have been opened during the 10th Plan but they are yet to be made operational. The Committee was informed that due to non-implementation of the SIU report on the Norms Study of CGHS allopathic dispensaries, creation of new posts was not being agreed to by the Ministry of Finance. The Committee would like to point out that in the absence of required manpower, purpose of opening new dispensaries gets defeated. Temporary arrangements being made by the Ministry by redeployment of doctors and outsourcing the support services of paramedical and other staff cannot be

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considered an ideal situation. The Committee, therefore, impressed on the Department that it would appreciate if the Department pursues the issue of creation of posts with the Ministry of Finance vigorously. The Committee found from the details furnished by the Department that a number of dispensary buildings were at present under construction and in the case of some buildings, approval is yet to be obtained from various civic agencies for commencement of construction work. The Committee emphasised that the Department should make concerted efforts to fulfill the target of opening of dispensaries and also making them operational during the Tenth Plan. 12.255 The Committee was constrained to observe that the combined formulary of CGHS/MSO in respect of proprietary medicines based on the recommendations of Shrivastava Committee report remains to be notified. The Committee found that yet another Committee has been constituted by the Ministry to review the Generic Drugs formulary/National Essential Drugs List from the prospective of requirement of CGHS system and other indenters annually. It was not known whether this newly setup Committee was given any time limit for giving its report. The Committee observed that already the notification of the drugs formulary has been over delayed considerably. The Committee, therefore, recommended that the report of the latest Committee should be expedited and follow-up action taken thereon without delay.

12.256 The Committee noted that at present ten double shift dispensaries are functioning under CGHS, Delhi. These dispensaries run in two regular shifts i.e. from 7.30 a.m. to 1.30 p.m. and the second shift from 1.30 p.m. to 7.30 p.m. The Committee had been emphasizing for the last few years for the need of earlier two shifts system of CGHS dispensaries. The Committee has now been informed that projection of 466 doctors and requisite staff was made by CGHS for making all the 244 allopathic dispensaries in the country to work in double shift. The Committee was surprised by the Department’s clarification about the interpretation of double shift system. Committee’s intention right from the beginning was for reverting to double shift (from 7.30 a.m. to 11.00 a.m. and from 5.30 p.m. to 7.30 p.m.). The Committee took serious objection to the contention of the department that reverting back to the earlier system of broken shift in the CGHS dispensaries is likely to raise protest from various CGHS employees associations as also from the doctors’ forum. The committee strongly felt that it is the responsibility of the department to convince the staff attached with CGHS dispensaries for reversion to double shift system. One should not forget that the CGHS dispensaries were meant to serve the beneficiaries. Accordingly all efforts needed to be made to provide them the maximum services. 12.257 Reply of the Ministry indicated that CBI inquiry on a complaint received with regard to recognition/reimbursement of Hospital Bills would take some time to be completed. In the process the review of the existing package rates for various procedures/treatment which is already overdue would be further delayed. Besides that, the Committee found that there were a number of procedural formalities to be completed before final recognition for both medical procedures / investigation as well as of private Hospitals / Diagnostic Centres. The Committee emphasized that this entire process should be completed in a time bound manner so that CGHS beneficiaries are not put to any inconvenience. 12.258 The Committee noted that a high-powered Committee under the Chairmanship of Shri P.K. Kaul, former Cabinet Secretary has been set up to review the functioning of CGHS and make it more user friendly. The Committee also took note of the fact that CGHS proposes to create specialist posts for augmenting the existing services. The Committee, however, emphasized that the department should make all efforts to get the recommendations of the Kaul Committee at the earliest. 12.259 The Committee took serious note of the unreasonable delay in the completion of the construction of the building of Vardhman Mahavir Medical College. Last year, the Committee was given to understand that the construction work would be complete by March 2006. The Committee was, however, constrained to observe that till now the construction work is yet to commence. The Committee was not convinced by the assurance given by the Ministry that the college building was scheduled to be completed within eleven months after the start of the construction The Committee was of the view that procedural formalities should be completed at the earliest. 12.260 The Committee had been observing the progress made in the implementation of “Pradhan Mantri Swasthya Suraksha Yojana” under which six AIIMS like institutions were to be set up in Bihar, Chattisgarh, Himachal Pradesh, Orissa, Rajashthan and Uttaranchal along with upgradation of six medical colleges in other states. The Committee found that this prestigious scheme still remained to be at the planning stage due to a number of procedural formalities yet to be completed. Meanwhile, the Committee was surprised to note that out of an outlay of Rs. 999 crore earmarked for the scheme, an amount of the Rs. 500 crore had been diverted

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to National Rural Health Mission. In such a situation the commitment given by the Ministry for spending the funds allocated for the project, once the approval of CCEA is obtained, does not have any meaning. The Committee had little hope about the “Pradhan Mantri Swasthya Surksha Yojna” taking off by the end of 10th Plan. 12.261 The Committee viewed with serious concern the unjustified delay in the procurement of required equipment for the Central Institute of Psychiatry, Ranchi. Approval for purchase of these equipments was given in February, 2002, i.e. last year of Ninth Plan. However, it had taken four years for completion of procedure for procurement and necessary provision of RS. 5.80 crores could be made in 2005-06. The Committee hoped that these equipments would be finally provided to the Institute by the end of Tenth Plan. 12.262 Media report continues to come about significant achievements being made in Stem Cell Therapy. The Committee had commented extensively in this regard in its Seventh Report presented to Parliament in April, 2005. The Committee was given to understand that draft guidelines for helping in regulation of Stem Cell research had been put on the ICMR Website. These guidelines suggested constitution of a multi-disciplinary National Apex Committee. The Committee had suggested that the approval process of draft guidelines pending before DCGI should be expedited. Latest Report furnished by the Department however, indicated that the draft guidelines for which a drafting Committee was set up in 2002 continue to remain at the draft stage even after a gap of three years. What is even more surprising is that a brainstorming Session is now being planned by ICMR to come out with a National Policy and appropriate guidelines for Stem Cell research. The Committee was not happy with this kind of approach. More than three years had passed since the constitution of Drafting Committee in November, 2002. The Committee strongly felt that there is a need both for extensive research in Stem Cell therapy promising cure of chronic health problems and also regulating false claims in this area. 12.263 Committee’s attention had been constantly drawn by the existence of a large number of vacancies of both medical and para-medical posts in the premier hospitals like Dr. R.M. L. Hospital, Safdarjung Hospital and Lady Hardinge Medical Collage and Hospital in Delhi. The Committee had been emphasizing the need for exemption of technical posts in these hospitals from the purview of DOPT’s guidelines issued on 16.5. 2001. The Committee was happy to note that all technical posts under the Ministry have now been exempted w.e.f. 17.3.05. The Committee had been informed that all the vacant posts of doctors in Dr. R.M.L and Safdarjung Hospital had been reported to UPSC for filling up. Similarly, other technical posts including Nursing and paramedics had been advertised by the hospital administration. While appreciating this encouraging development, the Committee emphasized that recruitment process needed to be expedited. More than nine months had lapsed since the notification issued on 17. 3. 05, vacant posts still remained to be filled up. The Committee strongly felt that there was an urgent need for evolving a regular mechanism for pursuing this issue. 12.264 The Committee observed that during the first three years of the Tenth Plan, inspite of funds being provided to Bihar under the National Programme for control of blindness, the state failed to take benefit from the same. Situation was very discouraging in 2003-04, when out of Rs. 220 lakhs, only Rs. 14.75 lakhs could be utilized. The Committee reiterated its stand for judicious and timely utilization of funds. 12.265 The Committee observed that the Department had chosen to overlook its recommendation suggesting a reassessment of the role of the District Collector/Deputy Commissioner. The Committee believed that the District Collector/ Deputy Commissioner is overloaded with work pertaining to a large number of departments. The Committee reiterated its earlier recommendation about involvement of some other Government representative who could be assisted in his monitoring/supervision by public representatives from village level Panchayats to local MPs.

12.266 The Committee was happy to note that its recommendation for treating foreign fund over and above the Gross Budgetary Support under the National AIDS Control Programme had been agreed to by the Planning Commission vide their communication dt. 10th June, 2005. The Committee pointed out that availability of additional funds would mean greater responsibility for judicious utilisation of funds. 12.267 Committee’s attention was drawn by utilisation of large funds under the National AIDS Control Programme for IEC activities in high prevalence States. Details furnished by the Department in respect of States like T.N, Karnataka, A.P and Manipur reveal that funds ranging from Rs. 1.22 crore to 1.95 crore had been allocated during 2003-04 and 2004-05 for this purpose to these states. Allocation for Maharashtra during 2003-04 and 2004-05 was Rs. 2.50 crore and Rs. 3 crore respectively. Similarly Nagaland, although

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smaller state, was released 1.80 crore and Rs. 1.50 crore during these two years. However, the Committee was surprised to note that details of expenditure and IEC activities are yet to be received from these two states. The Committee apprehended that this position might be in respect of some other states also. The Committee pointed out that expenditure of Rs. 77 crore and Rs. 85 crore for IEC activities out of total allocation of Rs. 225crore and Rs. 259 crore during 2003-04 and 2004-05 cannot be considered a small amount. The Committee was in agreement with the contention of the Department that in the absence of any vaccine, awareness is the only vaccine against HIV/AIDS at present. However, the Committee strongly felt that Govt. funds needed to be accounted for in every respect. The Committee therefore was of the view that there was a need for assessment of the impact made by IEC activities undertaken under the suspension of NACO, specially the role of NGOs and criteria for their deployment in districts. 12.268 The Committee noted that against the target of free ART to 100,000 AIDS cases by 2007, only 9168 patients have been started on free ART at 25 ART centres functional in 13 States in the country as on 31.3.2005. Another 14 Centres have been sanctioned to be functional by July, 2005. The Committee was not aware of the present status of these 14 Centres. Committee noted that 61 new Centres were planned to start by December-2005. Target of free ART treatment for 100,000 patients till 2007 continued to be there. The Committee was of the view that from only 9168 patients receiving free treatment by 31.3.2005 to reach the level of 100,000 patients by 2007, concerted efforts were required to be made. Taking note of the Action Plan and broad guidelines drawn by the Department in this regard, the Committee impressed upon the Department to adhere to the same strictly. 12.269 In its earlier report, the Committee had drawn the attention of the Department to an observation made in the CAG Report of 2004 about the fall-out of non-implementation of a decision made by the Department in December, 2002 of informing HIV positive blood donors about their status. The Committee strongly felt that there is an urgent need for having a re-thinking in this regard and not to restrict the revelation of HIV status to only result seeking donors. The Committee emphasized a dialogue may be initiated between all stake-holders so as to build up a consensus to include all donors. The Department should take action in this regard without any further delay. 12.270 The Committee was constrained to observe that the reports of the State Appraisal Teams regarding identification of specific districts, psychiatric units and mental hospitals to be funded under the Mental Health Programme were still being processed. The Department had also failed to specify whether reports had been received from all the States. The Committee urged upon the Department to expedite the process so that there was optimum and judicious utilisation of the allocated funds. 12.271 The Committee had been given to understand that 62 districts had availed the funding under DCCP which was started in 1990-91 but the scheme did not take off due to operational problems. The Committee wanted to know in detail about the operational problems faced by the districts in implementing these schemes. The Committee hoped that the constraints faced by States must have been taken care of under the revised NCCP. The Committee wanted to be apprised about the acceptance status with regard to 25 districts targeted to be covered under DCCP during 2005-06. The Department should also take up with the State Govts. the matter of identification of the nodal agency for effective implementation of the scheme as soon as possible. 12.272 Setting up of Medical Grants Commission was envisaged in the National Health Policy 2002 and Rs. 5 crore was allocated for it in the Tenth Plan. The Committee however observed that the modalities and functioning of the Medical Grants Commission was still being conceptualized and already fourth year of the Tenth Plan period is nearing its end. The Committee reiterated that all required steps need to be taken up for setting up the Medical Grants Commission should be expedited. 12.273 The Committee in its earlier report had commented upon the status of six pilot projects proposed to be launched during the Tenth Plan. Finding that these projects had not taken off, the Committee had observed that it would be feasible and appropriate if focus is there only on two projects instead of six and accordingly suggested Diabetes Control Programme and Cardiovascular Disease Control Programme can be taken up first. The Committee found that the Department, instead of giving a specific response to its suggestion, had only given details about the implementation of programme against Micronutrient Programme. While appreciating the work done under this programme, the Committee reiterated its suggestion for giving priority to Diabetes Control Programme and Cardiovascular Disease Control Programme. 12.274 The Committee observed that although the Seventh Report of the Committee was presented in April, 2005, its suggestion about utilisation of MPLAD Scheme Funds for providing financial assistance to needy

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persons for treatment of major and life-threatening diseases could be taken by the Ministry in September, 2005 to which the reply is awaited The Committee recommended to that the Ministry should vigorously pursue this matter with the Ministry of Statistics and Programme Implementation. VIII. Secretariat 12.275 The Committee Section was headed by a Committee Officer. An Additional Secretary, a Joint Secretary, a Deputy Secretary and an Under Secretary remained in-charge of the Branch. 12.276 To assist the Committee in its work, materials received from the Ministries/Departments, other organization and individuals were studied, and relevant points were culled out. Questionnaires for written/oral replies were prepared for use of the Committee. The Secretariat also used the materials like Parliamentary questions, Five-Year Plan documents, Newspapers, CAG Reports etc. relevant to the subjects under examination. 12.277 The work relating to drafting, consideration and adoption of draft reports by the Committee along with their presentation/laying, printing and distribution was undertaken. The Secretariat also undertook the work relating to the scrutiny of Action Taken Notes received from the Departments on the recommendation contained in the Reports of the Committee.

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ANNEXURE-XIII (See Para 12.6)

Details of the sittings of the Committee on H&FW during the year-2005

Sl.No. Dates of Meeting Duration Hrs. - Mts.

Purpose (Subject discussed) Institution visited/oral Examination etc.

1. 5-1-2005 1 - 00 (i) The Committee considered and approved the report of the study tour of the Committee made in November 2004. (ii) The Committee considered and approved the Questionnaire on Rural Health Services.

2. 24-1-2005 2 -10 (i) The Committee heard the representatives of SEWA Rural Gujarat, VHAI, Delhi, and IMA, Delhi respectively on the subject of Rural Health Services. (ii) The Committee also heard the Secretary Deptt. of Health, on the issue of Impact of New Product Patent Regime on our Health care system.

3. 3-3-2005 0 - 25 The Committee considered and adopted the 4th , 5th and 6th

Action Taken Reports on Demands-for-Grants (2004-2005).

4. 28-3-2005 2 - 05 The Committee considered the Demands- for-Grants (2005-06) of the Department of Health.

5. 29-3-2005 3 -30 The Committee considered the Demands- for- Grants (2005-06) of the Departments of Family Welfare and AYUSH.

6. 25-4-2005 1 -15 The Committee considered and adopted the 7th, 8th & 9th reports on Demands- for-Grants (2005-06).

7. 12-5-2005 1 - 30 The Committee heard the Secretary of Deptt. of AYUSH, on the Indian Medicine Central Council (Amendment) Bill-2005 & the Homeopathy Central Council (Amendment) Bill-2005.

8. 25-5-2005 1 - 30 The Committee heard the representatives of Central Council of Indian Medicine and experts of the Indian Medicine Central Council (Amendment) Bill-2005.

9. 26-5-2005 (i) The Committee heard the representatives of Central Council of Homeopathy and experts on the Homeopathy Central Council (Amendment) Bill-2005. (ii) The Committee also heard one expert on the Indian Medicine Central Council (Amendment) Bill-2005.

10. 1-7-2005 1 - 30 The Committee had clause-by-clause consideration of the Indian Medicine Central Council (Amendment) Bill-2005 & the Homeopathy Central Council (Amendment) Bill-2005.

11. 14-7-2005 1 -00 (i) The Committee adopted the 10th and 11th reports on the Homeopathy Central Council (Amendment) Bill-2005 and the Indian Medicine Central Council (Amendment) Bill-2005 respectively. (ii) The Committee also heard the Special Secretary, Department of Health on the Drugs & Cosmetics (Amendment) Bill-2005.

12. 9-9-2005 3 -15 (i)The Committee heard the representatives of various

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organizations and also NGOs on the Drugs and Cosmetics (Amendment) Bill-2005. (ii) The Committee also proposed to take up the issue of CGHS for examination subsequently.

13. 26-9-2005 5 -55 (i) The Committee heard the Secretary of the Department of Health & Family Welfare and the representatives of Indian Medical Association and the experts on the Indian Medical Council (Amendment) Bill-2005.

14. 21-10-2005 3 -00 The Committee heard representatives of Medical Council of India and Universities on the Indian Medical Council (Amendment) Bill-2005.

15. 17-11-2005 3 -00 (i) The Committee heard the Secretary Department of Health and Drug Controller General of India on the Drugs & Cosmetics (Amendment) Bill-2005. (ii) The Committee also heard representatives of Delhi Medical Association and Delhi Medical Council and one expert on the Indian Medical Council (Amendment) Bill-2005.

16. 15-12-2005 1 -00 The Committee considered and adopted the 12th Report on Drugs & Cosmetics (Amendment) Bill-2005 and the 13th, 14th & 15th Action Taken Reports on Demands-for-Grants (2005-2006).

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CHAPTER XIII

COMMITTEE ON PERSONNEL, PUBLIC GRIEVANCES, LAW AND JUSTICE

I. Composition of the Committee 13 The Committee was reconstituted on 5 August 2005 with 10 Members from Rajya Sabha and 21 Members from Lok Sabha. 13.1 The Committee consisted of the following Members:-

COMMITTEE ON PERSONNEL, PUBLIC GRIEVANCES, LAW AND JUSTICE

1. Shri E.M. Sudarsana Natchiappan - Chairman

RAJYA SABHA

2. Dr. Radhakant Nayak 3. Shri Raashid Alvi 4. Shri Balavant alias Bal Apte 5. Shri Ram Nath Kovind 6. Shri Tariq Anwar 7. Shri Ram Jethmalani 8. Dr. P.C. Alexander 9. Vacant 10. Vacant

LOK SABHA

11. Dr. Shafiqurrahman Barq 12. Kumari Mamata Banerjee 13. Shri Chhatar Singh Darbar 14. Shri N.Y. Hanumanthappa 15. Shri S.K. Kharventhan 16. Shri Shailendra Kumar 17. Prof. Vijaya Kumar Malhotra 18. Shri A.K. Moorthy 19. Shri Ramchandra Paswan 20. Shri Dahyabhai V. Patel 21. Shri Brajesh Pathak 22. Shri Shriniwas D. Patil 23. Shri Harin Pathak 24. Shri V. Radhakrishnan 25. Smt. M.S.K. Bhavani Rajenthiran 26. Shri Vishwendra Singh 27. Shri Bhupendrasinh Solanki 28. Vacant 29. Vacant 30. Vacant 31. Vacant

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II. Subjects selected for examination 13.2 During 2005 the Committee selected the following subjects for detailed examination:-

Sl. No.

Ministry/Department Subject

1. Ministry of Personnel, Public Grievances and Pensions Working of CBI;

2. - do - Administrative Reforms;

3. - do - *Civil Services Reforms;

4. Ministry of Law & Justice (Legislative Department) *Electoral Reforms; and

5. Ministry of Law & Justice (Department of Justice) *Legal Reforms.

* Referred by Hon'ble Chairman, Rajya Sabha 13.3 In addition to the above subjects, Hon’ble Chairman, Rajya Sabha referred the following Bills to the Committee for examination and report:-

Sl. No. Date of reference Name of the Bill

1. 27.5.2005 The High Court and Supreme Court Judges (Salaries and Conditions of Service) Amendment Bill, 2005

III. Constitution of Sub-Committees 13.4 During 2005 no sub-Committee was constituted. IV. Review of work done

(a) Sittings of the Committee

13.5 The Committee held 39 sittings lasting for 84 hours and 7 Minutes. Statement showing the dates of sittings of the Committee held during the period under review, the duration of the sittings, the number of Members present and the subjects discussed are given in Annexure XIV. (b) Materials and Memoranda furnished to the Committee. 13.6 Voluminous notes/documents were received from the concerned Ministries/Departments on the subjects/Bills examined by the Committee. 13.7 A large number of memoranda were received from the non-officials on different subjects/Bills examined by the Committee. (c) Study Visits: 13.8 During the period under review no study visit was undertaken by the Committee.

V. Reports Presented

(a) Reports

13.9 During 2005, the Committee presented the following Reports:-

Sl. No.

Report No. and Dates of Presentation/Laying

Rajya Sabha Lok Sabha

Subject

1. 21.03.2005 3rd 21.03.2005 Report on the Right to Information Bill, 2004.

2. 24.03.2005 4th 24.03.2005

Report on the Andhra Pradesh Legislative Council Bill, 2004.

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3. 20.04.2005 5th 20.04.2005

Report on Demands for Grants (2005-06) of the Ministry of Personnel, Public Grievances and Pensions.

4. 20.04.2005 6th 20.04.2005

Report on Demands for Grants (2005-06) of the Ministry of Law and Justice.

5. 13.05.2005 7th 13.05.2005

Report on the Hindu Succession (Amendment) Bill, 2004.

6. 26.07.2005 8th 26.07.2005

Report on the Scheduled Castes, Scheduled Tribes and other Backward Classes (Reservation in Posts and Services) Bill, 2004.

7. 04.08.2005 9th 04.08.2005 Report on the Arbitration and Conciliation (Amendment) Bill, 2003.

8. 04.08.2005 10th 04.08.2005

Report on the High Court and Supreme Court Judges (Salaries and Conditions of Service) Amendment Bill, 2005.

9. 04.08.2005 11th 04.08.2005 Report on the National Tax Tribunal Bill, 2004.

10.

29.08.2005 12th 29.08.2005

Report on the Contempt of Courts (Amendment) Bill, 2004

11. 29.11.2005 13th 29.11.2005

Report on the Prevention of Child Marriage Bill, 2004.

(b) Action Taken Reports 13.10 No Report on Action Taken by Government on earlier Reports of the Committee was presented to the House during the period under review. 13.11 Analysis of action taken by Government on the recommendations of the Committee in its earlier Reports: Nil 13.12 Minutes of sittings of the Committee relating to all the Reports presented to the House were prepared.

VI. Summary of Recommendations (a) 3rd Report 13.13. This Report pertains to the the Right to Information Bill, 2004

13.14 The Committee favoured the idea of NAC, NGOs and others for extending the coverage of the Bill to States/Local Bodies and Authorities as against the proposed restrictive application of the law to the Central Government or the bodies owned, controlled and financed by it. 13.15 Sensing that in the absence of reasonable and affordable fee structure for obtaining information it would be difficult to implement the Act successfully, the Committee was of the view that the poor should be exempted from paying any fee and in other cases it should not exceed the actual cost of supplying information. 13.16 On the lines of the principles of maximum disclosure, the Committee felt that the exemption provisions should be redrafted appropriately so as to justify their genuineness logically. It, accordingly, recommended amendments in clause 8 of the Bill. 13.17 To ensure greater autonomy and independent functioning of the Central Information Commission; to have persons from varied fields like law, science and technology, social service management, journalism, mass media apart from administration and governance in the Commission; to lift bar on the M.Ps, M.L.As or others to be appointed as officers of the Commission and to enable the officers of the Commission to seek further employment on cessation of their offices, the Committee recommended certain amendments/deletion/insertion at appropriate places in clauses 12 and 13. The Committee also desired to

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confer on the functionaries of the Commission, the status of the Chief Election Commissioner and the Election Commissioner. 13.18 The Committee was of the view of that in the absence of adequate and comprehensive penal provisions, the objective of the law could not be achieved fully. The Committee, accordingly, recommended (in clause 17) for stringent and effective penal provisions for delaying information. 13.19 Going by the past experience of non-enforcement of the Freedom of Information Act, 2002 even after lapse of two years from its enactment, the Committee looked forward to the Government for implementation of the new law within the specified period of one hundred and twenty days. (b) 4th Report 13.20 Realising that there had been relentless efforts for revival of the Legislative Council in Andhra Pradesh for about twenty years since its abolition which also reflected the zeal and urge of the people of the State, the Committee whole heartedly supported the Bill for the creation of Legislative Council in the State. 13.21 Considering the demand of Primary Teachers’ Associations/Federations for their enrolment in the list of Teachers’ Constituency since 1957, the Committee was of the view that now a days all the Teachers’ of Primary Schools possessed higher qualifications than they used to possess earlier and, as such, their demand seemed to be justified and needed to be re-looked by the Government.

(c) 5th Report 13.22 This Report pertains to Demands for Grants of the Ministry of Personnel, Public Grievances and Pensions (2005-06) 13.23 Observing that only 24.67 percent of the total budget allocation was left for various plan schemes/programmes, the Committee opined that the Ministry of Personnel Public Grievances and Pensions should play a far greater role in formulating more plan schemes for wide ranging subjects under its administrative control. 13.24 Observing that dependence of the CBI on the executive wing of the State for both financial and administrative matters impinges upon its role as an independent investigating agency, the Committee recommended that the possibility of promulgating a separate Act for CBI in tune with the requirement of the time, rather than deriving its powers from the Delhi Special Police Establishment Act, 1946 (DSPE Act), may be examined by the Government.

13.25 The Committee observed that the Ministry had not delegated adequate financial powers to Director, CBI which had resulted in glaring disparities in its financial powers vis-à-vis those of the Heads of CPMFs. The Committee, accordingly, recommended for enhancement of financial powers of the Director, CBI along with appointment of an Internal Financial Advisor to render expert advice on financial matters. 13.26 The Committee was of the opinion that adequate steps were not being taken at the Central Government's level to overcome the persisting vacancy problem in the CBI. In this context, the Committee recommended the following:

(i) Keeping in view the deputationist orientation of the organisation, where expertise and experience of the best available talent of the CPOs and State Police Officers are utilised, attractive incentives should be given to those joining the CBI from other organisations;

(ii) The requirement of prior approval of the Screening Committee constituted by the Government, for filling of direct recruitment vacancies should be waived for CBI; and

(iii) The Director, CBI, being the head of the organisation should be made a full-fledged member of the CBI Selection Committee for choosing all officers for induction into the CBI.

13.27 The Committee noted that the Scheme of Citizens' Charters took off in 1996-97 and, so far, all the State Governments have not come up with their Citizens' Charters. At the Central level, about 29 Ministries/Departments of Government of India have brought out such Charters. The Committee recommended that all the Central Government Ministries/Departments/Organisations should be impressed

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upon to come out with their Citizens' Charters and proactive steps should be continued to encourage/motivate the State Governments in this direction. 13.28 The Committee noted that though training was the most important component in the efficient functioning of any administrative set up, the activities of the Ministry in this direction run far short of expectation. The funds allocated for the functioning of various State Training Institutes had remained unutilised as these had not yet been established. The Committee was of the opinion that the Central Ministry had to take a far more proactive step in impressing upon the States to initiate measures in this direction. 13.29 The Committee while noting the recent decision of the Union Cabinet, as reported in the media, to set up the Second Administrative Reforms Commission to prepare a blueprint for revamping the public administration system, urged upon the Government to finalise the terms of reference of the Commission at the earliest, so that it starts functioning and completes its work within the stipulated period. 13.30 The Committee desired that the recommendations of all the expert Committees constituted so far on Civil Services Reforms should be expeditiously examined and a framework should be prepared for carrying out civil service reforms without any further delay. In this context, the Committee strongly urged that the appointment of the Second Administrative Reforms Commission should not come in the way of implementation of the recommendations made by the various Committees. (d) 6th Report 13.31 This Report pertains to Demands for Grants of the Ministry of the Ministry of Law and Justice (2005-06) 13.32 In view of the fact that some States were scheduled to go to polls in May, 2006, the Committee impressed upon the Delimitation Commission to expedite the delimitation of the Lok Sabha and Assembly Constituencies in all the States. 13.33 Expressing its serious concern over delay in filling up the vacancies of members in additional benches of Income Tax Appellate Tribunal (ITAT) due to which these benches were non-functional by the time of taking up this issue by the Committee, the Committee recommended to start the process of appointment of members without any further delay. 13.34 The Committee noted that the scheme under the National Legal Services Authority had not received very encouraging response as only eight State Legal Services Authorities had come forward in raising ceiling of income for seeking legal-aid. The Committee also focused on certain grey areas like constraints of funds and non-utilisation of grants by the State Legal Services Authorities. The Committee, therefore, recommended that these bottlenecks should not come in the way of successful implementation of the scheme and additional funds should be allocated to help operationalise the various programmes to be undertaken by NALSA under its Vision Document. 13.35 Noting that Permanent Lok Adalats for public utility services in the country had been established, so far, by Punjab and Karnataka and National Capital Territory of Delhi and remaining States/Union Territories were still in the process of considering the proposals for establishing Permanent Lok Adalats, the Committee expressed its unhappiness over the progress and recommended that the Government should chalk out a time-bound programme for constituting these Lok Adalats and monitor the pace of implementation thereof. 13.36 Considering the role of the Law Commission in the Indian judicial and legislative system, the Committee recommended that the Government should consider providing statutory backing to the Commission and implement its recommendations in letter and spirit. 13.37 The Committee recommended to expedite establishment of National Law University and Law Schools in the eastern, western and northern regions of the country and take all necessary steps in this direction. 13.38 The Committee noted that the Grantee Institutions, like the Indian Law Institute, the International Centre for Alternative Dispute Resolution, the Institute of Constitutional and Parliamentary Studies and the Bar Council of India have confined their operations mainly to academic pursuits or training programmes. The Committee therefore, recommended that the Government should assess the working of these institutions from the point of view of their contribution in research projects and programmes and exploration into new areas.

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13.39 Noting that annual accounts of the ICADR were audited since long as a result of which it was difficult to ensure a fair and clear representation of facts and figures pertaining to the working of the organisation, the Committee recommended that the Government should submit a report to the Committee about the funds spent on construction of the building of ICADR, status of its construction and the position of auditing of the accounts within six months from the date of presentation of the Report in Parliament. 13.40 In view of the numerous complaints of the voters all over the country about irregularities committed in preparation of these rolls and also the fact that persons employed in revision of electoral rolls were generally drawn from Government establishments lacking professional skill in undertaking the task, the Committee emphasised for establishing offices of the Election Commission at district levels to cover the maximum voters and also to ensure greater accountability towards the lapses. 13.41 To ensure that elections are held in free and fair manner necessary infrastructure, electronic voting machines constitute a part of which, should be in place at the time of holding elections, the Committee felt. The Committee desired that a definite time-frame should be chalked out for replacement/upgradation and procurement of electronic voting machines. 13.42 The Committee observed that nearly 69.60% voters were issued identity cards leaving a shortfall of about 30% of those who were yet to be covered under the scheme. The Committee was of the view that the Election Commission had not achieved the desired goals despite the fact that considerable time had elapsed since the inception of the EPIC scheme. Accordingly, the Committee had recommended to devise a time-bound programme for achieving 100% EPIC coverage. 13.43 Going by the experience of the common law in the country like England which has started simplifying its laws language-wise, the Committee felt the need to initiate the similar move in India also keeping in view the fact that legislative formulations were quite technical, intricate and incomprehensible for a common man. The Committee, therefore, recommended that the Government should explore the ways and means in simplify laws so as to be understood even by people having no specialized knowledge of legislative drafting. 13.44 The Committee welcomed the move for a ten-years perspective plan, which in its opinion might achieve physical targets set under the Centrally Sponsored Scheme relating to infrastructural facilities for the judiciary. It, however, cautioned that the plan should not be a mere pretext to lengthen the implementation of the Scheme. The Committee recommended that basic facilities like transport and housing should be available to the Magistrates and Judges for discharging their functions effectively. 13.45 In view of the Committee, computerisation would be an effective tool to bring down pendency of cases, one major problem confronting the Judiciary. The Committee recommended that Government should allocate sufficient funds to computerise the entire judicial system of the country. The Committee also recommended that Judges of the Supreme Court and High Courts should be provided laptops to bring in efficiency and provide effective basis for Judicial Reforms as the Judges would be in a position to monitor, supervise and control cases from their initial stages to their final disposal. 13.46 The Committee noted that despite several alternative modes of disposal like specialised benches, Lok Adalat, Fast Track Courts etc. already in place, the position of pendency of cases before the Supreme Court, High Courts and various subordinate courts all over the country had not shown significant improvement. The Committee, therefore, called upon the Government to address the problem of pendency of cases by analysing the factors responsible carefully and searching viable solutions in addition to the existing arrangements. 13.47 Observing that vacancies of Judges in Supreme Court and High Courts had persisted since long notwithstanding the concern expressed at different fora including the Parliamentary Standing Committee, the Committee felt that it was the high time when the issue should not only be deliberated at the highest level, but also debated in the public domain so that there could emerge an alternative system to resolve the problem. The Committee called upon the Government to come forward with a concrete alternative, addressing the issue of appointment of Judges of the higher judiciary, so that the vacancies could be filled up on the date of their occurrence. 13.48 Establishing benches of the Supreme Court in other parts of the country had been persistent demand of the Committee keeping in view the interest of the poor who cannot afford to travel form their native places to Delhi. Noting that there had been opposition by the Supreme Court for establishing benches of the Supreme Court in other parts without any justification, the Committee impressed upon the Government to discuss this

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issue once again with the Supreme Court and explore the possibility of establishing a bench of the Supreme Court in Chennai on experimental basis in the first instance.

13.49 Fast Track Courts were creation of the recommendations of the Eleventh Finance Commission to reduce pendency of the cases in the Supreme Court, High Courts and Subordinate Courts. An amount of Rupees 502.90 crore was recommended by the Commission as one of the upgradation grants for constituting 1734 Fast Track Courts in the country. The Scheme was to remain in operation for a term of five years i.e. till expiry of the term of the Eleventh Finance Commission. The Twelfth Finance Commission did not make any recommendation to continue the scheme. This left the scheme in the lurch as after 31 March, 2005 there would be no taker of the scheme. In this backdrop, the Committee deplored the role of the Government in sitting idle over the issue knowing that the scheme won laurels even of the Supreme Court. The Committee was of the view that the Department of Justice should have taken up the issue of continuing the scheme with the Ministry of Finance or the Planning Commission for funding the Fast Track Courts after 31 March, 2005 well in advance. The Committee recommended that the Department of Justice should vigorously pursue this issue and till the scheme was finalised, take up the matter with the State Governments for providing funds to be reimbursed subsequently by the Central Government. 13.50 The Committee recommended for introducing principles and techniques of management in resolving problems like inordinate delays in settlement of cases, arrears of cases and increased workflow in the court system. Going by the experience of the United Kingdom and the United States of America, the Committee found that some innovative methods like Annual Judicial Statistics Report and Judicial Impact Statement had helped to enable the public to understand the performance of the judiciary and asses the likely effect of the legislation upon the workload of the courts. (e) 7th Report 13.51 This Report pertains to the Hindu Succession (Amendment) Bill, 2004

13.52 The Committee observed that a distinction was made between married and unmarried daughters while granting them the status of coparceners in the Mitakshara joint family system. Daughters married before commencement of proposed the Hindu Succession (Amendment) Act, 2004 would not get the benefit of the amendment. The Committee, therefore, recommended that for those undivided Hindu joint family governed by the Mitakshara system, where partition had not taken place at the time of commencement of the Act, the already married daughters should be given the status of coparceners. This way, a large section of already married women could be brought under the purview of the Bill without the fear of increased litigation.

13.53 The Committee welcomed the amendment in section 6 of the Principal Act as proposed in the Bill, whereby daughters have been given the status of coparceners in the Mitakshara joint family system. At the same time the Committee had expressed apprehension that the position of other Class I female heirs such as wife and mother should not suffer as a result of this move. The Committee recommended that the Government should examine this concern and make suitable provisions to ensure that no injustice was done to the other female heirs, especially the widow.

13.54 The Committee noted that as per the rules of succession laid down by the Hindu Succession Act, 1956, in case of a Hindu male dying intestate, his interest would devolve firstly to Class I heirs. However, as pointed out by the Law Commission, the principle of representation among Class I heirs went upto two degrees in the male line of descent, but in the female line of descent, it went upto only one degree. Therefore, the Committee recommended that the Schedule to section 8 of the Hindu Succession Act, 1956, which contains the list of Class I and Class II heirs, should be amended to include heirs from the female line of descent upto two degrees, thus underscoring the principle of gender justice and equality.

13.55 The Committee recommended that the term 'partition' as mentioned in the amended section 6(5) as proposed by the Bill, should be properly defined, leaving no scope for any arbitrary interpretation. Partition for all practical purposes, should be registered or should have been effected by a decree of the court. In cases where oral partition was recognised, it should be backed by proper documentary evidence.

13.56 The Committee took note of the fact that the objections were raised from various quarters regarding continuation of section 4(2) of the principal Act, which stated that the Act would not affect the provisions of any law providing for prevention of fragmentation of agricultural holdings or fixation of ceilings or

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devolution of tenancy rights. Taking cognizance of the view submitted before the Committee that tenurial laws in many States, particularly those of the northern belt, showed gender discrimination giving primacy to male lineal descendents in matters of tenancy and land, the Committee recommended to the Government to consider deletion of that sub-section from the principal Act by including the amendment in the present Bill, or else, a subsequent amending legislation might be brought in to address the issue.

13.57 The Committee commented on Section 24 of the principal Act, which sought to prevent certain sections of widows from inheriting property of the intestate if she had remarried. The Committee expressed its view that the Government should examine the justification behind retaining the aforesaid section of the Act in the context of modern times, whereby focus was on effecting gender equality and making the laws of the land gender neutral. The Committee recommended that the aforesaid section may be omitted from the body of the Act, by way of an amendment in the present Bill, or else, a subsequent legislation may be brought in, to cover all such issues not covered under the present Bill.

(f) 8th Report 13.58 This Report pertains to the Scheduled Castes, Scheduled Tribes and Other Backward Classes (Reservation in Posts and Services) Bill, 2004 13.59 The Committee recommended for deletion of sub-clause (c) of clause 2 so as to exclude the creamy layer from the purview of reservation as the Committee viewed that excluding a well off class from other backward classes only on the basis of judicial interpretation would curb the scope of reservation for certain people which, in turn, would go against the spirit of the Constitution which emphasized for ensuring adequate representation for backward class citizens. 13.60 The Committee also recommended for amending sub-clause (iii) of clause 2(d) of the Bill so as to bring a corporation within the purview of reservation irrespective of the proposed ceiling of fifty-one percent of the paid up share capital held by the Government. Thus, any corporation even with less than 51% paid up share capital holding by the Government proposed to be brought within ambit of the Bill. 13.61 The Committee also recommended deletion of sub-clause (n) of clause 2 as per view of the Committee reservation should also be extended to scientific or technical posts. 13.62 The Committee also recommended deletion of the proviso to clause 3 of the Bill in view of its observations/contained in para 8.3 that creamy layer should not be excluded from benefit of reservation in jobs or service under the state. 13.63 The Committee considered the cumulative effect of the provisions contained in sub-clauses (2), (3) and (4) of clause 3 and felt that these provisions would curtail the scope of reservation for SCs, STs and OBCs. The Committee, accordingly, recommended for deletion of sub-clauses (2), (3) and (4). 13.64 In respect of the provisions contained in clause 4 regarding no reservation in certain cases, the Committee recommended that short-term and work-charged-posts as well as scientific and technical posts should also be brought within ambit of reservation. The Committee cautioned that while applying reservation in scientific or technical posts elements of competence and efficiency should not be compromised. 13.65 The Committee recommended amendment of clause 6 so as to increase maximum age-limit by five years instead of the proposed three years for direct recruitment for candidates of OBCs. 13.66 The Committee also recommended for reduction in the examination fee and application fee payable by OBCs for recruitment to a post through competitive examination. 13.67 The Committee found that in the existing circumstances, Liaison Officer was given limited powers and it was also doubtful whether he would be able to perform his duties properly as he would have to deal with grievances of different communities. The Committee, accordingly, recommended for separate Liaison Officers for different communities.

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13.68 On the question of raising the ceiling of 50% the Committee viewed that Government should carry out a survey to assess the size of different communities in the total population of the country and make an appraisal of their representations according to their population and if need be explore the feasibility of enhancing the limit. 13.69 The Committee impressed upon the Government to consider constituting a special Monitoring Committee, to oversee the overall enforcement of the Act and impose penalties or propose disciplinary action, etc. for contravening the provisions of the Act. 13.70 The Committee observed that the Bill did not contain comprehensive penal provisions and, therefore, it impressed upon the Government to consider inserting suitable penal provisions in the Bill almost on the pattern of the Reservation Act of Uttar Pradesh. 13.71 Considering different social, ethnic, geographic, educational and economic conditions of SCs, STs and OBCs, the Committee desired that there should be separate legislations, one for SCs and STs and other for OBCs. 13.72 On the issue whether OBCs should be given reservation in promotions also like SCs and STs, the Committee felt that reservation should also be extended to the members of other backward classes to ensure their adequate representations in jobs/services under control of Government. 13.73 The Committee felt that all the schemes and plans chalked out for the minorities communities had not been of desired levels. As a result of this, these communities suffered a lot. The Committee therefore, observed that considering reservation to backward classes of these communities would be a step forward in the direction of their overall development. 13.74 To keep this statue out of judicial intervention, the Committee suggested to the Government to include the Act in the Ninth Schedule to the Constitution. 13.75 The Committee also suggested to curb induction of fresh categories till the objective of adequate representation for the existing categories of backward classes is achieved. The Committee also impressed upon the Government to identify categories who really needed reservation as was experienced that generally a particular sub-caste or group of a homogeneous class might have been enjoying the benefit of reservation depriving other castes. 13.76 The Committee felt that a schedule reflecting the lists of the three backward communities each showing sub-castes and groups identified for reservation by the Central and State Governments and also showing percentage fixed for reservation of SCs, STs and OBCs at National, State and Regional Level should be appended to the Bill. (g) 9th Report 13.77 This Report pertains to Arbitration and Conciliation (Amendment) Bill, 2003 13.78 The Committee recommended that in order to reduce the pendency of arbitration cases and to ensure accountability of arbitrators, Part I A and two Schedules might be incorporated in the 1996 Act. The A Schedule would provide for sole arbitration which would be governed by Part I of the Act. The B Schedule would provide for institutionlised arbitration to be governed by Part I A of the Act. Part I A might provide for a statutory autonomous permanent institution known as the Indian Arbitration Commission which should be presided over by the Chief Justice of India. This institution should be vested with the powers to grant accreditation to professional institutions which come forward to render their services in the field of institutionlised arbitration. 13.79 Another issue which had been highlighted is that in various Public Sector Undertakings and Government Departments, the arbitration and conciliation proceedings are not properly regulated. In this regard, the Committee recommended that the benefits of institutionalised arbitration should be made available to Public Sector Undertakings also.

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13.80 The Committee was of the considered view that the Bill might not suffice in achieving the desired objectives. Therefore, the Committee had recommended that the Government might consider bringing in a fresh comprehensive legislation on the subject. (h) 10th Report 13.81 This Report pertains to High Court and Supreme Court Judges (Salaries and Conditions of Service) Amendment Bill, 2005. 13.82 The Committee took note of the concerns expressed by people about Judicial reforms, of which salaries allowances and other perks are important constituents. While agreeing to the proposals for hike in pension and other components for the Judges of High Courts and Supreme Court, the Committee observed that the Central problems, such as pendency of Cases in Supreme Court and High Courts, vacancies of Judges and lack of infrastructural facilities, needed prompt attention. 13.83 The Committee impressed upon Government to consider the following issues: —

(a) need to carry out a study for revising the existing salary and allowances structure for higher judiciary;

(b) examining the feasibility of introducing the pattern of allowances and salary, applicable to the Judges of some advanced Countries of the World;

(c) removal of differentiation between the judges appointed direct and those elevated from the Bar, in determining qualifying period for pensionery benefits; and

(d) better and improved monetary package for Judges of Supreme Court and High Courts, after retirement.

(i) 11th Report 13.84 This Report pertains to the National Tax Tribunal Bill, 2004 13.85 The Committee, during its deliberations, expressed doubts as to whether setting up of the National Tax Tribunal would reduce the pendency of tax related cases. 13.86 The Committee felt that providing for additional Benches in High Courts which would be manned by Judges specializing in tax matters would rectify the current problem of divergent decisions given by High Courts on identical questions of law. Such Benches might deal exclusively with tax cases. The Committee also felt that the existing vacancies of High Court Judges were another reason for pendency of tax cases. Therefore, the Committee were of the opinion that filling up of these vacancies would ensure quicker disposal of tax cases. 13.87 The Committee recommended that the Chief Commissioners of the Income Tax Department might be given an opportunity to become Members of the National Tax Tribunal. The Committee recommended that the provision for reappointment of Members and the Chairperson of National Tax Tribunal might be deleted. Similarly, the provisos fixing the age limits for Members and the Chairperson may be deleted. The Committee recommended that only professionally qualified persons such as Advocates, Company Secretaries, Chartered Accountants, Cost and Works Accountants might be authorised to appear before the National Tax Tribunal. (j) 12th Report 13.88 This Report pertains to the Contempt of Courts (Amendment) Bill, 2004 13.89 While appreciating the move of Government for introduction of defence of truth in contempt proceedings, the Committee did not overlook the need to amend the Constitution of india in future, keeping in view inherent powers exercised by the Supreme Court and High Courts under the Constitution for contempt of themselves. The Committee observed that the higher judiciary is known for maintaining principles of reasonableness and fairness and for this reason, it expressed optimism that the higher judiciary would give due regard to the spirit of the amending legislation.

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13.90 On the question as to who should decide the contempt of court whether the same Judge against whom allegations had been made or a different Judge, the Committee observed that courts were guided by the procedures which they used to follow under the facts and circumstances of each individual case and the contemner would, therefore, be getting full opportunity to make his defence. 13.91 The Committee recommended for deletion of the words “in public interest” in clause 2 of the Bill as, in its opinion, there would be an extreme burden imposed on the contemner and unless he established truth in the public interest, court would not allow him to proceed further. This would defeat the very propose of the legislation. 13.92 The Committee found it more appropriate to insert suitably or reflect the proposed defence of truth as one of the exemptions or defences under Section 8 of the Principal Act, as it would give the contemner an additional help, since he might plead the defence of truth and might not be held punishable. (k) 13th Report 13.93 This Report pertains to the Prevention of Child Marriage Bill, 2004 13.94 The Committee observed that there were different definitions of “Child” in different statutes which may, in comparison with the definition of children in the proposed legislation, cause anomaly and confusion as to which definition was more appropriate. Citing an example of the Indian Penal Code which rendered a married girl child of 15 years mature enough to give her consent for sexual intercourse, the Committee found it absurd and contradictory that while a married girl child as per the Indian Penal Code was quite mature while on the other hard, a girl married at an age of 15 years would still be a child as per the proposed legislation. The Committee therefore, recommended for amending the Indian Penal Code to remove any anomaly and bring the two legislations in parity with each other. 13.95 The Committee endorsed age differentiation for male and female, yet it asked the Government to consider the views proposing a common age of 18 years for both the sexes as the issue of determination of marriage age is inextricably related to other social aspects which, if ignored, might entail serious consequences on an individual and society as a whole. 13.96 The Committee found that rendering a child marriage voidable at the option of any contracting party would cause further complications considering the social pressures and mindset of the people belonging to lower strata of society who may have inhibitions to be subjected to court’s proceedings. The Committee, therefore, recommended that a child marriage should be rendered void ab initio. 13.97 The Committee noted that the Hindu Marriage Act, 1955 provides grounds for rendering a marriage null and void and voidable under Sections 11 and 12 respectively. But these provisions do not include therein sub-clause (iv) of Section 5 setting completion of 21 years for bridegroom and 18 years for bride as one of the conditions for rendering a marriage null and void and voidable mandatory for solemnization of marriage. The Committee observed that both the proposed legislation and the Hindu Marriage Act,1955 had social relevance and therefore there should not be any incongruity in the provisions of these legislations. The Committee, therefore, recommended for amendment of the Hindu Marriage Act, 1955. 13.98 The Committee strongly condemned the practice of exchange of valuable at the time of solemnization of child marriage as in its view, such orthodox practice sent a wrong massage to the whole society. The Committee, therefore, opined that the Government should initiate measures to confiscate valuables exchanged between the parties, as it would act as a prohibitory social response against perpetuation of such practice. 13.99 The Committee recommended emphatically for initiating social measures, such as, creation of rehabilitation fund for providing shelter, food, education, health and security for the victims of child marriages so as to bring them in the mainstream of Government’s welfare programmes and policies like midday meal scheme, Sarva Shiksha Abhiyan and health for all etc. The Committee observed that merely by enacting legislative measures, the evil of child marriage could not be curbed. For this, social measures should go hand in hand with the preventive steps, with an active support and coordination of officials of Panchayat, Tehsil, District and State levels, NGOs and social groups and agencies. 13.100 The Committee suggested some radical measures for the contracting parties i.e. a girl or boy married at an early age with a view to making them accessible to the various programmes or schemes launched for

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welfare and overall development of the children married early with participation of NGOs, social groups, public representatives and bureaucrats both at national and states level. 13.101 Keeping in view internationally agreed child welfare standards set by the Convention on the Rights of the Child (CRC) and the International Human Rights Commission, the Committee recommended for stringent and rigorous penal provisions as curbing child marriage creates an obligation on the Government to frame an effective law. The Committee, in this context, observed that the punishment for the same kind of offence was starkingly less in the Hindu Marriage Act, 1955. The Committee, therefore, urged the Government to amend the said Act to bring it in parity with the proposed legislation in respect of punishment. 13.102 The Committee did not favour the provision exempting a woman from punishment for promoting or permitting solemnization of child marriage as in view of the Committee, there was a greater risk of her being used as an instrument to solemnize child marriage. The Committee advocated for leaving the matter of exemption on court which might decide the issue taking into account of facts and circumstances of each case. 13.103 The Committee felt that the whole community and all persons attending a child marriage could not be held guilty of committing an offence, but at the same time it should be ensured that the parents, public representatives, or government functionaries who were actively or passively involved in promoting child marriage did not escape their responsibility. 13.104 The Committee recommended for the punishment of a term of ten years for enticing or taking a child out of the keeping of the lawful guardian or forcibly compelling or inducing him/her deceitfully to go from any place or for selling, trafficking or using a child for immoral purposes. 13.105 The Committee suggested for evolving a mechanism for perfect coordination, massive interaction and wider consultation among different social as well as government agencies, Civil Society experts, NGOs, academicians, researchers, lawyers, jurists and officers such as, women IPS officers, religious leaders, and public representatives with a view to promoting concrete initiatives to curb a child marriage. 13.106 The Committee strongly recommended for compulsory registration of marriages so that a proper system could be set in for keeping an eye on the preventive measures and their effect on curbing child marriages in the country. 13.107 The Committee regretted for not having any standard data collection system and, therefore, it has asked the Government to encourage researches on prevalence of child marriages by reputed research organizations, NGOs etc so that based on the research inputs, a social campaign might be launched for eradication of practice of child marriage. VII. Secretariat 13.108 The Committee Section (Personnel and Law) headed by a Committee Officer constituted the Secretariat of the Committee. A Joint Secretary, a Deputy Secretary and an Under Secretary remained incharge of the Section. 13.109 The work relating to drafting, consideration and adoption of draft Reports by the Committee along with their presentation, laying and distribution was undertaken. 13.110 The Secretariat also studied material like Parliamentary Debates, answers to Parliament Questions, Budget Documents, Five Year Plan Documents, Appropriation Accounts (Civil), CAG Reports on accounts of the Union Government (Civil), Books, Journals, Newspapers etc. relevant to the subjects under examination of the Committee. The Secretariat also made use of the material downloaded from the various websites.

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Annexure - XIV (See Para 13.5)

Details of the Meetings of the Committee on Personnel and Law held during 2005:-

Duration Sl. No.

Date of Meeting Hrs - Mts.

Main Agenda

1. 05.01.2005 2-12 Oral evidence on the Arbitration and Conciliation (Amendment) Bill, 2003 of – (i) Representatives of Ministry of Urban Development and CPWD; (ii) Representatives of MTNL; and (iii) Visit to CBI Academy Ghaziabad.

2. 06.01.2005 2-04 Oral evidence on the Arbitration and Conciliation (Amendment) Bill, 2003 of – (i) Representatives of NTPC; (ii) Dr. P.K. Aditya, Advocate, Chandigarh; and (iii) Shri Lalit Bhasin, Sr. Advocate.

3. 07.01.2005 2-15 Oral evidence on the Arbitration and Conciliation (Amendment) Bill, 2003 of – (i) Representatives of Railway Board; (ii) Representatives of GAIL; and (iii) Presentation by the Secretary, Department of Legal Affairs, Ministry of Law and Justice, on the National Tax Tribunal Bill, 2004.

4. 19.01.2005 2-45 Presentation by: (i) the Secretary, Legislative Department on the Arbitration and Conciliation (Amendment) Bill, 2003; (ii) the Secretary, Department of Legal Affairs, Ministry of Law and Justice, on the Bill. Oral evidence of the following on the Bill: (i) the representatives of ONGC; (ii) the representatives of HPCL; and (iii) the representatives of SAIL.

5. 20.01.2005 3-11 Oral evidence of the following on the Bill: (i) the representatives of ONGC; (ii) the representatives of ICADR; (iii) the representatives of Indian Council of Arbitration; (iv) the representatives of Bar Council of India; and (v) the representatives of Coal India Ltd.

6. 01.02.2005 1-43 Preliminary consideration of the Right to Information Bill, 2004 and presentation by Secretary (Personnel) thereon.

7. 02.02.2005 2-04 Oral evidence of the representatives of following Association/ organization on the National Tax Tribunal Bill, 2004:- (i) Indian Revenue Service Association; and (ii) Institute of Chartered Accountants of India.

8. 03.02.2005 2-41 Preliminary consideration of the- (i) Hindu Succession (Amendment) Bill, 2004 and presentation by Secretary, Legislative Department thereon. (ii) Scheduled Castes, Scheduled Tribes and other Backward Classes (Reservation in Posts and Services) Bill, 2004 and presentation by Secretary, Ministry of Personnel, Public Grievances and Pensions thereon.

9. 14.02.2005 6-50 (i) General discussion on the Right Information Bill, 2004; (ii) Oral evidence on the Right to Information Bill, 2004; (iii) Oral evidence (Contd.)

10. 16.02.2005 4-25 Oral evidence of Prof. Bina Agarwal, Institute of Economic Growth, University of Delhi on the Hindu Succession (Amendment) Bill, 2004; Presentation by Secretary (Legislative Department), Ministry of Law and Justice on the Andhra Pradesh Legislative Council Bill, 2004; Further oral evidence of Smt. Maja Daruwala, representative of Commonwealth Human Right Initiative (Delhi) on the Right to Information Bill, 2004; Shri Arvind Kezriwal, Representative of the Non-Governmental Organisation ‘Parivartan’ on the Right to Information Bill, 2004; and Presentation by Dr. P.K. Mishra, Member-Secretary, National Capital Region Planning Board, New Delhi on earthquake

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management in Gujarat in the context of citizen-related aspects of disaster management activities as part of the Committee’s study of Administrative Reforms and Public Grievances Redressal Mechanism.

11. 17.02.2005 1-55 Oral evidence on the Scheduled Castes, Scheduled Tribes and Other Backward Classes (Reservation in Posts and Services) Bill, 2004.

12. 01.03.2005 1-58 Clause-by-clause consideration of the Right to Information Bill, 2004.

13. 02.03.2005 1-48 To resume clause-by-clause consideration of the Right to Information Bill, 2004.

14. 10.03.2005 3-53 Oral evidence of experts/ organizations on the following Bills:-(i) Scheduled Castes, Scheduled Tribes and Other Backward Classes (Reservation in Posts and Services) Bill, 2004; (ii) Andhra Pradesh Legislative Council Bill, 2004.

15. 16.03.2005 1-00 (i) Consideration and adoption of draft report on Right to Information Bill, 2004; and (ii) Clause-by-clause consideration of Andhra Pradesh Legislative Council Bill, 2004.

16. 22.03.2005 0-23 Further discussion on the Scheduled Castes, Scheduled Tribes and Other Backward Classes (Reservation in Posts and Services) Bill, 2004.

17. 30.03.2005 3-09 (i) Presentation by Secretary, (Justice) on Demands for Grants (2005-06) of Department of Justice followed by Question-Answer Session; and (ii) Presentation by Secretary, (Personnel) on Demands for Grants (2005-06) of Ministry of Personnel, Public Grievances and Pensions followed by Question-Answer Session.

18. 31.03.2005 2-22 (i) Presentation by Secretary, (Legislative) on Demands for Grants (2005-06) of Legislative Department followed by Question-Answer Session; and (ii) Presentation by Secretary, (Legal Affairs) on Demands for Grants (2005-06) of Department of Legal Affairs followed by Question-Answer Session.

19. 11.04.2005 1-00 Consideration and adoption of draft report on Demands for Grants (2005-06) of related Ministries/Departments. I. The Chairman to:- (i) consider and adopt the following draft Reports:- (a) Report on Demands for Grants (2005-06) of the Ministry of Personnel, Public Grievances and Pensions; and (b) Report on Demands for Grants (2005-06) of the Ministry of Law and Justice. (ii) authorise the Chairman to nominate a Member from Rajya Sabha and two Members from Lok Sabha to present/lay the Reports to/in Rajya Sabha/Lok Sabha, respectively; and (iii) authorise Chairman to decide date of presentation/laying of the Reports. III. Any Other Item With The Permission Of The Chair.

20. 19.04.2005 1-55 Oral evidence on:– (i) Scheduled Castes, Scheduled Tribes and Other Backward Classes (Reservation in Posts and Services) Bill, 2004; and (ii) the Hindu Succession (Amendment) Bill, 2004.

21. 20.04.2005 1-29 Oral evidence continued:– the Scheduled Castes, Scheduled Tribes and Other Backward Classes (Reservation in Posts and Services) Bill, 2004.

22. 27.04.2005 1-31 Clause-by-clause consideration of the Hindu Succession (Amendment) Bill, 2004.

23. 03.05.2005 0-55 Clause-by-clause consideration of the Scheduled Castes, Scheduled Tribes and Other Backward Classes (Reservation in Posts and Services) Bill, 2004

24. 10.05.2005 0-50 Consider and adopt draft reports on:– (i) the Hindu Succession (Amendment) Bill, 2004.

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25. 07.06.2005 1-45 (i) Presentation by the Secretary, Department of Justice on the High Court and Supreme Court Judges (Salaries and Conditions of Service) Amendment Bill, 2005, (ii) Consideration and adoption of the revised draft report on Scheduled Castes, Scheduled Tribes and Other Backward Classes (Reservation in Posts and Services) Bill, 2004.

26. 08.06.2005 2-41 (i) Clause-by-clause consideration of the Arbitration and Conciliation (Amendment) Bill, 2003; and (ii) Further evidence on National Tax Tribunal Bill, 2004.

27. 22.06.2005 2-17 (i) Presentation by the Secretary, Department of Justice (Ministry of Law and Justice) on the Contempt of Courts (Amendment) Bill, 2004, (ii) Further oral evidence on National Tax Tribunal Bill, 2004.

28. 05.07.2005 2-00 Oral evidence on the (i) Contempt of Court (Amendment) Bill, 2004; and (ii) High Court and Supreme Court Judges (Salaries and Conditions of Service) Amendment Bill, 2005.

29. 14.07.2005 2-20 Further oral evidence on the (i) Contempt of Courts (Amendment) Bill, 2004; and (ii) National Tax Tribunal Bill, 2004. Presentation by Secretary, Legislative Department (Ministry of Law and Justice) on the Prevention of Child Marriage Bill, 2004;

30. 28.07.2005 1-35 I. Clause-by-clause consideration of the following Bills:- (i) Contempt of Courts (Amendment) bill, 2004; (ii) High Court and Supreme Court Judges (Salaries and Conditions of Service) Amendment bill, 2005; and (iii) National Tax Tribunal Bill, 2004 II. Consideration and Adoption of Draft Report on Arbitration and Conciliation (Amendment) Bill, 2003.

31. 02.08.2005 0-30 Consideration and Adopt the following Draft Report :- (i) Report on the Contempt of Courts (Amendment) bill, 2004; (ii) Report on the High Court and Supreme Court Judges (Salaries and Conditions of Service) Amendment bill, 2005; and (iii) Report on the National Tax Tribunal Bill, 2004.

32. 23.08.2005 1-00 Consider and adopt draft reports on the Contempt of Court (Amendment) Bill, 2004.

33. 12.09.2005 2-05 (i) Presentation by the Secretary, Department of Women and Child Development (Ministry of Human Resource Development) on the Prevention of Child Marriage Bill, 2004; (ii) Oral evidence of witnesses on the Prevention of Child Marriage Bill, 2004.

34. 27.09.2005 2-05 Further oral evidence on the Prevention of Child Marriage Bill, 2004.

35. 28.09.2005 4-10 Presentation by the Secretary, Legislative Department (Ministry of Law and Justice) on “Electoral Reforms”; and Further Oral evidence on the Prevention of Child Marriage Bill, 2004.

36. 17.10.2005 1-16 Further oral evidence on the Prevention of Child Marriage Bill, 2004

37. 18.10.2005 2-00 Clause-by-clause consideration on the Prevention of Child Marriage Bill, 2004;

38. 27.10.2005 2-15 Consideration and Adoption of Draft 13th Report on Prevention of Child Marriage Bill, 2004. Further discussion on the “Electoral Reforms”.

39. 14.12.2005 1-50 Presentation by the Secretary, Ministry of Personnel, Public Grievances & Pensions and Secretary, Department of Consumer Affairs, on “Public Grievances Redressal Mechanism”, as a part of study of Administrative Reforms.