3.1 Policy Measures- Competition Act 2003

The Competition Act, 2003 provides for the setting up of a Competition Commission of India (CCI) with a view to:

i. Prevent practices having adverse effects on competition,

Ii. Curtail abuse of dominance, promote and sustain competition in market,

Iii. Ensure quality of products and services, protect the interest of consumers and

Iv. Ensure freedom of trade carried on by other participants in domestic markets.

Objectives of CCI (2003):

i. Anti-Competitive Agreements:

This covers both the horizontal and vertical agreements. It states that four types of horizontal agreements between enterprises involved in the same industry would be applied.

These agreements are those that:

Ii. Abuse of Dominance:

The Act lists five categories of abuse:

Iii. Combinations Regulation (Merger and Amalgamation):

The Act states that any combination that exceeds the threshold limits in terms of value of assets or turnover can be scrutinised by the scrutinised by the CCI to determine whether it will cause or is likely to cause an appreciable adverse effect on competition within the relevant market in India.

Iv. Enforcement:

The CCI, the authority entrusted with the power to enforce the provisions of the Act, can enquire into possibly anti­competitive agreements or abuse of dominance either on its own initiative or on receipt of a complaint or information from any person, consumer, consumer’s association, a trade association or on a reference by any statutory authority. It can issue ‘cease and desist’ orders and impose penalties. The CCI can also order the break-up of a dominant firm.

3.2 Divestment policy

In simple terms, Disinvestment is taking your money out of the businesses you invested in.

For example,

Ram invested Rs. 1, 00,000 in ABC Ltd. For the previous couple of years for 500 shares in the company. Today, he plans to sell his shares to Shyam.

Here Ram is disinvesting in ABC Ltd.

The word, disinvestment is usually used in the context of Public Sector Undertakings (PSUs).

When the govt. Sells its shares in PSUs (Companies where the govt. Has over 51% ownership) to private Entities, it's called disinvestment.

History of divestment in India

In India, the new economic policy has given rise to significant focus for the privatization of public enterprises within the year 1992. Disinvestment may be a method of privatization for public enterprises.

It is a significant step towards privatization and liberalization of the Indian economy.

The Indian economy was adversely suffering from bankruptcy during the period 1981-91.

The public sector which was alleged to achieve new heights and was taught to be the right path for India’s economic growth, right from independence was characterized by poor and sick performance.

In the year 1991, there have been 236 operating PSUs, of which only 123 were profit making.

The top 20 profit making PSU’s counted for 80% of the profits, implying that but 10% of the PSU’s were liable for 80% of profits. The return on PSUs investment for the year 1990-91 was just around 2%.

Allowing the private sector to pump capital into these ailing PSUs would, of course, go how in turning around these entities whilst it provides the govt with funds to bankroll welfare programs.

Hence, the method of disinvestment in India was started in the year 1992.

Major divestment steps were taken in the past by BJP led NDA government in the tenure between1999-2004, made four strategic disinvestments –

• Bharat Aluminum Company (BALCO) and Hindustan Zinc, both to Sterlite Industries Ltd.

• Indian Petrochemicals Corporation Limited (IPCL) to Reliance Industries Ltd. And

• VSNL to the Tata group

Again, in ranging from 2014 to 2018, BJP led NDA government divested total Rs. 1,94,646 crores, which also includes minority and majority stake sale of most profitable Public sector undertaking companies, like ONGC-HPCL deal worth Rs. 36,915 crores.

In the budgetary announcement of the fiscal year 2017-18, the minister of finance noted that the govt initiated strategic disinvestment in 24 PSUs, including Air India, this fiscal.

Since the fiscal year, 1991-92 to 2017-18 government led by political parties sold total public assets of Rs. 3,47,439 Crore.

Objectives of divestment in India

Disinvestments are primarily motivated by the optimization of resources to deliver maximum returns.

Disinvestment in India is aimed toward reducing the financial burden on the govt because of the inefficient and poorly functioning PSUs (called sick units) and to boost public finance.

It introduces competition and market discipline and helps to depoliticize non-essential services.

Sometimes, disinvestments also can be called upon for political or legal reasons.

Importance of divestment in India

Currently, the govt. Of India has around Rs. 2 lakh crores locked up in PSUs.

Disinvestment of the govt. Stakes in these companies, thus, it far too significant within the Indian economy. The disinvested money is often used for:

• Financing India’s increasing fiscal deficit.

• Financing large-scale infrastructure projects across the country.

• Increasing consumption and demand.

• Minimizing government debt – Almost 40-45% of the Centre’s revenue receipts go towards repaying debt or interest in the same.

• Implementing social programs in health and education sectors.

On the opposite hand, private entities or companies buy these disinvested stakes in PSUs for an inexpensive price and the skills, discipline, and talent brought in by such private entities helps in improving the overall performance of such Sick Units.

What is current divestment target in India

The government in its interim budget 2019, set the disinvestment target for FY 2019-20 at Rs. 90,000 crores, above the Rs. 80,000 crores budgeted for the continued year that it said would be exceeded.

The government had raised Rs 35,532 crore from disinvestment till December of 2018.

Interim minister of finance Piyush Goyal said in the budget speech that the govt had pursued a public enterprises asset management agenda to form these entities accountable to the people.

As the new government takes a charge for the second term, the Prime Minister NarendraModi led National Democratic Alliance (NDA), is expected to require up immediate and swift disinvestment of at least a dozen state-owned companies.

Some of the key disinvestments that were announced but couldn’t proceed because of market conditions.

• Offer purchasable of General Insurance Corporation of India Ltd. And New India Assurance Company Ltd.

• Divestment in MSTC Ltd. Through Initial Public Openings (IPO).

• Strategic disinvestment of 100% government holding in Central Electronics Ltd.

• Strategic disinvestment of Bridge and Roof Ltd.

• Disinvestment in North Eastern electric power Corporation Ltd. Through IPO.

• Divestment in Bharat Electronics Ltd. Through offer purchasable.

• Disinvestment in NBCC (India) Ltd. And HUDCO through offer-for-sale.

• Sale of Air India and five of its subsidiaries: The strategic disinvestment process will begin once more in national carrier Air India, which is neck deep in debt, and it's likely to commence during August-September 2019.

• Strategic divestment of Pawan Hans.

• Strategic divestment of 100% government holding in Bharat Pumps & Compressors Ltd.

All these disinvestments are likely to expedite in the coming months.

Types of divestment methods

The method of disinvestment in India changes from time to time, mostly counting on the party at the center.

But there are primarily 3 different approaches to disinvestments (Government’s perspective).

1. Minority Disinvestment

Minority disinvestment in PSUs is such, at the end of it, if the govt of India retains a majority stake (typically quite 51%) in the company, it ensures management control.

Historically, minority stakes are either auctioned off to financial institutions or offloaded to the general public by way of an offer for sale.

The present government has made a policy statement for FY 2018-19 that all disinvestments would only be minority disinvestments through public offerings.

Minority disinvestment via auctioning to institutions returns into the early and mid-90s and is not any longer the preferred method in India.

Some samples of minority disinvestment via Offer purchasable include recent issues of power grid Corporation of India Ltd., Rural Electrification Corporation Ltd., NTPC Ltd., NHPC Ltd., etc.

2. Majority Disinvestment

Majority disinvestment in PSUs is such, at the top of it, the govt of India retains a minority stake in the company i.e. it sells off a majority stake. It's also called Strategic Disinvestment.

If we glance into the disinvestment history, majority disinvestments are typically made to strategic partners of the govt of India.

These strategic partners can be other Central Public Sector Enterprises (CPSEs) themselves, a few examples being BRPL/MRL to Indian Oil Corporation Ltd. (IOC) and KRL to BPCL.

Alternatively, these strategic partners are often private entities, like the sale of recent Foods to Hindustan Lever Ltd., CMC to Tata Consultancy Services Ltd. (TCS).

Also, same as within the case of minority disinvestment, in majority disinvestment case the stake also can be offloaded by way of a suggestion purchasable, separately or in conjunction with a purchase to a strategic partner.

3. Complete Disinvestment

Complete disinvestment or privatization is a sort of majority disinvestment wherein 100% control of the company is passed on to a buyer i.e. government of India completely disinvests from that PSU.

Example of this includes 18 hotel properties of India Tourism Development Corporation (ITDC).

THE BOTTOM LINE

It is an ambitious bid to realize or surpass the govt. Of India’s target of raising Rs. 90,000 crores from disinvestment proceeds in FY 2019-20, as it looks set to sell stakes of a number of companies which has attracted wide interest from private entities.

The massive mandate of 353 seats won by the NDA is predicted to further provides a boost to the government’s disinvestment drive in India.

3.3 Micro, Small and Medium Enterprises [MSME sector] since 2007

Introduction

The Ministry of Small-Scale Industries and Argo and Rural Industries was created in October 1999. In September 2001, the ministry was split into the Ministry of Small-Scale Industries and the Ministry of Agro and Rural Industries. The President of India amended the govt. Of India (Allocation of Business) Rules, 1961, under the notification dated 9 May 2007. Pursuant to the present amendment, they were merged into one ministry.

The ministry was tasked with the promotion of micro and small enterprises. The small Industries Development Organization was under the control of the ministry, as was the National Small Industries Corporation Limited public sector undertaking).

The Small Industries Development Organization was established in 1954 on the premise of the recommendations of the Ford Foundation. It's over 60 offices and 21 autonomous bodies under its management. These autonomous bodies include Tool Rooms, Training Institutions and Project-cum-Process Development Centers.

Services provided include:

• Facilities for testing, tool minting, training for entrepreneurship development.

• Preparation of project and product profiles.

• Technical and managerial consultancy.

• Assistance for exports.

• Pollution and energy audits.

It also provides economic information services and advises Government in policy formulation for the promotion and development of SSIs. The sector offices also work as effective links between the Central and State Governments.

Current status of MSMEs

The Ministry of Micro, Small and Medium Enterprises, a branch of the govt of India, is the apex executive body for the formulation and administration of rules, regulations and laws concerning micro, small and medium enterprises in India.

The Minister of Micro, Small and Medium Enterprises is Nitin Gadkari and the Minister of State is Pratap Chandra Sarangi since 31 May 2019.

The statistics provided by the annual reports of Ministry of Small and Medium Enterprises (MSME) shows an increase in the plan amount spent on the khadi sector from 1942.7 million to14540 million, and non-plan amounts from 437 million to 2291 million, in the period from 1994–95 to 2014–2015. The interest subsidies to khadi institutions increased from 96.3 million to 314.5 million in this period.

Definition of micro, small and medium enterprise

In accordance with the provision of Micro, Small & Medium Enterprises Development (MSMED) Act, 2006 the Micro, Small and Medium Enterprises (MSME) are classified in two Classes:

Manufacturing Enterprises-the enterprises engaged in the manufacture or production of goods pertaining to any industry laid out in the first schedule to the industries (Development and regulation) Act, 1951) or employing plant and machinery in the process useful addition to the final product having a distinct name or character or use. The Manufacturing Enterprise is defined in terms of investment in Plant & Machinery.

Service Enterprises: -The enterprises engaged in providing or rendering of services and are defined in terms of investment in equipment.

The limit for investment in plant and machinery / equipment for manufacturing / service enterprises, as notified, vide S.O. 1642(E) dtd.29-09-2006 are as under

Manufacturing Sector

Service Sector

Growth and performance of MSMEs

The micro, small and medium enterprises have made significant contribution in Indian economy in term of employment, investment, and output. It is depicted from the below mentioned tables.

Table 2: Performance of MSME

Note: The figures shown in bracket are the growth rate over the previous year. Source: Ministry of Micro, Small and Medium Enterprises Annual Report 2006-07, 2010-11 and 2013-14

Table 1 clearly shows that number of units in MSME sector has been increased from 123.42 lakh to 467.56 lakh which is around 4 times in span of 8 years. Since 2007-08 to 2012-13 growth rate is consistent this is moving around 4%. Highest growth rate was in the year 2006-07 wherein MSMED act, 2006 was passed. Similarly, Employment in this sector has improved from 249.91 to 1061.52 in the year 2012-2013 which is four times of the year 2005-06. Investment in MSMES has also been increased to develop this sector in the interest of the nation.

Table 3: Contribution of Manufacturing Output of MSMEs in GDP

Source: Ministry of Micro, Small and Medium Enterprises, Annual Report 2013-14

Table 3 shows that that contribution of MSME in total manufacturing output is not increasing rather it is slightly decreasing. Similarly, in the case of GDP, contribution of the MSME is increasing at the consistent rate. It may be happening due to the use of outdated technology in the MSMEs and lack of the implementation of the schemes announced by the government.

DISTRIBUTION OF MSMEs

MSMES play an important role in the development of the economy as whole. Out of the whole MSMES, 31.79% are engaged in manufacturing and rest 68.21 are imparting services. Over 6000 products starting from traditional to high-tech are being manufactured by the MSMES besides the services. 55.34% of the entire MSMES are located in country and 44.66% are found out in urban area. It ensures the development of the rural and backward area. 94.41% MSMES are the proprietary enterprises and rest are travel by the partnership firm, private companies, and co-operative/trusts. It shows that this sector encourages the new entrepreneurs.

Importance of MSMEs for the Indian Economy

Across the globe, MSMEs are accepted as a means of economic growth and for promoting equitable development. They are known to generate the highest rate of growth in the economy. MSMEs have driven India to new heights through requirements of low investment, flexible operations, and the capacity to develop appropriate native technology.

Problems of MSMEs in India

• Accessibility to World Market: After the economic reforms MSMES are ready to sell their product not only in the domestic market but also in the foreign markets.

• Foreign Investment and Technology: MSMES in India were facing dearth of finance and using outdated technology but after globalization many foreign companies are being collaborating with MSMES which can help them in financing and to use better technology.

• Balanced Regional Development: MSMES is set up in rural and economic backward area thereby can meet the local need and develop the area economically.

• Better Performance: After the economic reformsMSMES in India face competition from MNCS,the competitive environment in the market will bringthe better performance of the MSMES.

• Employment Generation: The handicraft and other products made by this sector are highly demanded within the market and it are often even more if this sector gets support in terms of technology, finance, and promotional strategy. It provides 50% of private sector employment.

• New area of Business: New technology like biotechnology and nano-technology are providing opportunities to the young entrepreneurs to begin their own business in the new area like outsourcing and sub contracting etc.

• Less Capital Intensive: MSMES requires less investment. Young generation which has passed professional courses like MBA and engineering can start their own enterprise by investing little amount.

• Promoted and Supported by Government: Government has announced several schemes for the promotion of the MSMES because it is one of the main contributors to Indian economic growth. Financially support and subsidies also are provided by the govt.

• Exports Contribution: 40% of the export in India is thru MSMES channel.

• Absence of Banking Finance: MSMES get little or no percent of net bank credit. This sector mainly depends on personal savings, loan from relatives and loan from local money lenders.

• Outdated Technology: Most of the MSMES use poor technology base as a result of that they manufacture inferiority products and face low productivity.

• Infrastructural Problem: MSMES face infrastructural problem which incorporates inadequate power supply, water supply and roads etc.

• Storage Problem: This sector doesn't have proper storage facility therefore quality of the products deteriorates and they have to bear an enormous amount of loss.

• Inadequate Marketing: MSMES don't have proper marketing strategy and marketing research programme, even most of MSMES aren't having their own website which is the biggest tool of marketing.

• Lack of Skilled Worker: Most of the workers are unskilled who don't possess any diploma, degree and knowledge. At the first stage new entrepreneurs aren't ready to pay enough to trained worker therefore they need to depend upon the unskilled workforce.

• Withdrawal of Reservation Policy: Earlier some items were reserved for the small-scale industries but after liberalization such items has been opened for the domestic also as for the MNCS.

• Extreme Competition: This sector is facing keen completion from the massive domestic firms andMNCS with improved technology, skilled workforce, marketing skills, better quality and wide selection of products.

RECENT CHANGES IN MSMES IN 2020

The definition of who qualifies as a micro, small, and medium-sized enterprise (MSME) in India has changed based on investment and turnover. The new definition will apply to both manufacturing and services MSMEs in India.

This was announced within the first tranche of minister of finance NirmalaSitharaman’s COVID-19 special economic package, Atmanirbhar Bharat Abhiyan or Self-Reliant India on May 13, 2020.

The new definition expands the types of businesses who can now avail MSME status and enjoy linked benefits.

REVISION TO DEFINITION ANNOUNCED ON MAY 13, 2020

• Enterprises with investment up to INR 10 million (US$132,521), turnover up to INR 50 million (US$662,715) are defined as micro units.

• Enterprises with investment up to INR 100 million (US$1.3 million), turnover up to INR 500 million (US$6.62 million) are defined as small units.

• Enterprises can qualify as medium-sized units if they need investment up to INR 200 million (US$2.6 million), turnover up to INR 1 billion (US$13.24 million).

Until now The Micro, Small and Medium Enterprises Development (MSMED) Act, 2006, had governed the coverage and investment ceiling of MSMEs in India and the Act recognized two categories of MSMEs – manufacturing and services. Details on how the latest changes are going to be reflected in legal amendments are now awaited.

MSME-INDIA-CLASSIFICATION-MAY-2020

COVID-19 special relief announced in first tranche of economic package on May 13, 2020: Measures which will help MSMEs

As the finance minister, NirmalaSitharaman, is predicted to announce other aspects of the economic package in the week, foreign investors should track announcements released on the websites of the company affairs ministry, MSME ministry, and the finance ministry to remain updated. Consult with our India offices so we will help your business navigate the new changes and avail of incentive schemes and regulatory relaxations.

• Collateral free loan of INR 3 trillion (US$39.84 billion) for MSMEs with a turnover up to INR 1 billion (US$13.24 million). This may benefit 4.5 million units so that they will resume work and save jobs. This scheme can be availed till October 31, 2020.

• For stressed MSMEs, subordinate debt provision of INR 200 billion (US$2.65 billion) has been announced for 200,000 MSMEs.

• Equity infusion worth INR 500 billion (US$6.6 billion) through special fund for MSMES that have viable operations but need handholding because of COVID-19.

• A fund of funds with corpus of INR 100 billion (US$1.3 billion) will be set aside to help the capacity expansion of those units, including enabling them to urge listed on the market should they choose that.

• Global tenders not allowed for government procurement of up to INR 2 billion (US$26.5 million).

• To catch up on cancelled trade fairs, the Indian government will be found out online market linkages.

• A reduction of 25 percent on the Tax Deducted at Source (TDS) and Tax Collected at Source (TCS) from May 14, 2020 to March 31, 2021.

• The deadline for all income tax return filings will be extended from July 31, 2020 to November 30, 2020.

• The Vivaad se Vishwas scheme, addressing disputes on tax payments, has been extended till December 31, 2020.

• All pending refunds to charitable trusts and non-corporate businesses and professions, including proprietorship, partnership, LLP and co-operatives to be issued immediately.

• Statutory provident fund contributions for all private sector organizations and their employees covered by the EPFO are going to be reduced to 10 percent from 12 percent.

• Tax audit deadline from September 30, 2020 to October 31, 2020.

Key takeaways

3.4 Industrial Pollution in India: Meaning, Types, Effects and Control

In order to produce daily needs of the growing population, differ­ent sorts of industries are setup to supply different products. The industries use raw materials, process them and produce fin­ished products. Besides the finished products, a decent number of by-products are produced. Out of all the by-products, if some are in huge quantities and therefore the processing is cost effective, the indus­trialist preserves the by- products.

If the processing of waste may be a cost prohibitive one, then the industrialist throws the waste into the environment within the sort of gas, liquid or solid. The gases are usually released into the atmosphere, the liquids are discharged into aquatic bodies like canals, rivers or sea and solid wastes are either dumped on the land or in aquatic bodies. Altogether the cases, either the air or water or land are polluted because of dumping of wastes.

Till now, there are about 17 industries which are declared to be most polluting. These include the caustic soda, cement, dis­tillery, dyes and dye intermediaries, fertilizers, iron and steel, oil refineries, paper and pulp, pesticides and pharmaceuticals, sugar, textiles, thermal power plants, tanneries then on. The table  enlists few of the industries, their wastes (important) and the sort of pollution these induce in the environment.

The big variety of pollutants as shown above enters the envi­ronment and disturbs the natural eco-system affecting the biota. Due to industrial activities, a range of poisonous gases like NO, SO2, NO2, SO3, Cl2, CO, CO2, H2SO4 etc.- volatile chemicals, dusts etc., are liberated into the atmosphere causing acute pollution problem. Besides, the accidental leakage of poisonous gases can cause havoc.

For example, Methyl Isocyanine gas leakage from Union Carbide factory at Bhopal caused mass killing which is known as Bhopal gas tragedy. Additionally, to accidents, many of the above poisonous gases induce depletion of ozone layer, crea­tion of ozone hole. Green House effect, global warming, Acid rain, destruction of monument and killing of living organisms disturbing the natural eco-systems.

The nature of the industrial waste depends upon the industrial process in which these originate and the raw materials the utilization.

Broadly the industrial wastes are also divided into two groups:

(a) Process waste;

(b) Chemical waste.

(A) Process Waste:

The waste generated in an industry during washing and processing of raw materials is understood as process waste. The proc­ess waste is also organic or inorganic in nature depending upon the raw materials used and nature of the industry.

The organic process wastes are liberated from food processing units, distiller­ies, breweries, paper and pulp industry, sugar mills etc. The inor­ganic process wastes could also be the effluents of chemical industries; caustic soda industry, paint industry, petroleum industry, pesti­cide industry etc. Both organic and inorganic process wastes are toxic to living organisms.

The solid wastes released by different industries are often di­vided in to 2 different group’s i.e.

(a) Process wastes, and

(b) Packing wastes.

Since different industries use different raw materials, the qual­ity and quantity of solid wastes differ from industry to industry. Industries releasing the solid wastes in the sort of fly ash are dumped on the ground which results in soil pollution.

Some amount of fly ash also contaminates atmospheric tract causing respiratory tract disorders. Metallic industries produce tons of solid metallic waste and large quantities of slag. In addition to the re­lease of hazardous chemical pollutants, the industries may also cause thermal pollution and noise pollution. The thermal pollution is because of release of predicament from indus­tries into aquatic bodies. The noise pollution is because of running of heavy machinery producing plenty of noise.

(B) Chemical Wastes:

The chemical substance generated as a by-product during the preparation of a product is understood as chemical waste. The chemical waste includes heavy metals and their ions, deter­gents, acids and alkalis and various other toxic substances.

These are usually produced by the industries like fertilizer factories, paper and pulp industries, iron and steel industries, distilleries, sugar mills etc. These are usually liberated into nearby water bodies like rivers, lakes and seas and sometimes into lands. The entry of those chemicals into bodies may alter the pH, BOD (Biological Oxygen Demand) and COD (Chemical Oxygen Demand).

The loading of suspended solids (ss), heavy metals and their ions brings a few drastic changes in physiochemical nature of the water. The aquatic animals and plants absorb, accumulate and bio-concentrate the chemical wastes resulting in bio magnifications and eventually destroying the trophic levels and food chains of the eco-system. Hence these disturb the eco-system dynamics and eco-system balance of the character.

Causes of industrial population

1. Lack of Policies to Control Pollution

Lack of effective policies and poor enforcement drive allowed many industries to bypass laws made by the pollution control board, which resulted in mass-scale pollution that affected the lives of many people.

2. Unplanned Industrial Growth

In most industrial townships, unplanned growth took place wherein those companies flouted rules and norms and polluted the environment with both air and water pollution.

3. Use of Outdated Technologies

Most industries still rely on old technologies to produce products that generate a large amount of waste. To avoid high cost and expenditure, many companies still make use of traditional technologies to produce high-end products.

4. Presence of a Large Number of Small Scale Industries

Many small scale industries and factories that don’t have enough capital and rely on government grants to run their day-to-day businesses often escape environment regulations and release a large number of toxic gases in the atmosphere.

5. Inefficient Waste Disposal

Water pollution and soil pollution are often caused directly due to inefficiency in the disposal of waste. Long term exposure to polluted air and water causes chronic health problems, making the issue of industrial pollution into a severe one. It also lowers the air quality in surrounding areas, which causes many respiratory disorders.

6. Leaching of Resources From Our Natural World

Industries do require a large amount of raw material to make them into finished products. This requires the extraction of minerals from beneath the earth. The extracted minerals can cause soil pollution when spilled on the earth. Leaks from vessels can cause oil spills that may prove harmful to marine life.

7. Natural Resource Use

Raw material is a must for industries, which often requires them even pulling out underground elements. One of the most common forms of leaching from natural resources is fracking for oil.

When industries extract minerals, the process causes soil pollution and also causes oil leaks and spills that are harmful and even deadly to people and animals.

Effects of industrial population

1. On human health:

(i) It causes irritation of eye, nose, throat respiratory tracts, etc.

(ii) It increases mortality rate and morbidity rate.

(iii) a range of particulates mainly pollens, initiate asthmatic attacks.

(iv) Chronic pulmonary diseases like bronchitis and asthma are aggravated by high concentration of SO2, NO2, and particulate and photo-chemical smog.

(v) Certain heavy metals like lead may enter the body through lungs and cause poisoning.

2. On animal health:

In case of animals, the pollutants enter in two steps.

(i) Accumulation of the airborne contaminants in the vegeta­tion forage and prey animals.

(ii) Subsequent poisoning of the animals once they eat the contaminated food. Just in case of animals, three pollutants namely fluorine, arsenic and lead are liable for most livestock dam­age.

3. On plants:

Industrial pollution has been shown to possess serious adverse effects on plants. In some cases, it's found that vegetation over 150 Km. Faraway from the source of pollutants are found to be affected. The main pollutants affecting plants are SO2, O3, MO, NO2, NH3, HCN, Ethylene, Herbicides, PAN (Peroxy Acetyl ni­trate) etc. within the presence of pollutants, the healthy plants suffer from neurosis, chlorosis, abscission, epinasty etc.

Effects of Industrial Pollution on Our Environment

1. Water Pollution

The effects of industrial pollution are far-reaching and liable to affect the ecosystem for many years to come. Most industries require large amounts of water for their work. When involved in a series of processes, the water comes into contact with heavy metals, harmful chemicals, radioactive waste, and even organic sludge.

These are either dumped into open oceans or rivers. As a result, many of our water sources have a high amount of industrial waste in them, which seriously impacts the health of our ecosystem. The same water is then used by farmers for irrigation purposes, which affects the quality of food that is produced.

Water pollution has already rendered many groundwater resources useless for humans and wildlife. It can at best be recycled for further usage in industries.

2. Soil Pollution

Soil pollution is creating problems in agriculture and destroying local vegetation. It also causes chronic health issues to the people that come in contact with such soil on a daily basis.

3. Air Pollution

Air pollution has led to a steep increase in various illnesses, and it continues to affect us on a daily basis. With so many small, mid and large scale industries coming up, air pollution has taken a toll on the health of the people and the environment.

4. Wildlife Extinction

By and large, the issue of industrial pollution shows us that it causes natural rhythms and patterns to fail, meaning that the wildlife is getting affected in a severe manner. Habitats are being lost, species are becoming extinct, and it is harder for the environment to recover from each natural disaster.

Major industrial accidents like oil spills, fires, the leakage of radioactive materials and damage to property are harder to clean-up as they have a higher impact in a shorter timeframe.

5. Global Warming

With the rise in industrial pollution, global warming has been increasing at a steady pace. Smoke and greenhouse gases are being released by industries into the air, which causes an increase in global warming.

Melting of glaciers, extinction of polar bears, floods, tsunamis, hurricanes are few of the effects of global warming.

6. Biodiversity Loss

Industrial pollution continues to cause significant damage to the earth and all of its inhabitants due to chemical wastes, pesticides, radioactive materials etc. It affects wildlife and ecosystems and disrupts natural habitats. Animals are becoming extinct, and habitats are being destroyed.

The increasing liquid, solid and hazardous wastes undermine ecosystem health and impact on food, water and health security. Industrial pollution disasters, including oil spills and radioactive leakage, take years to decades to clean up.

7. Atmospheric Deposition

Cadmium enrichment of soil can also be associated with industrial pollution. Topsoils contaminated by mine spoil showed a wide range of Cd concentrations.

Industrial effluents are commonly discharged to surface water drainage systems after clarification in tailing ponds. Recent investigations have disclosed very high concentrations of Cd in the overbank and bottom sediments of the rivers.

Control of industrial population

The ultimate object behind the measures to regulate pollution to take care of safety of Man, Material and Machinery (Three Ms) The implementation of control measures should be based on the prin­ciple of recovery or recycling of the pollutants and must be taken as an integral a part of production i.e. never as a liability but always an asset.

Some important control measures are:

1. Control at Source:

It involves suitable alterations in the choice of raw materials and process in treatment of exhaust gases before finally discharged and increasing stock height up to 38 meters so as to ensure proper mixing of the discharged pollut­ants.

2. Selection of Industry Site:

The industrial site should be properly examined considering the climatic and topographical characteristics before setting of the industry.

3. Treatment of industrial Waste:

The industrial wastes should be subjected to proper treatment before their discharge.

4. Plantation:

Intensive plantation in the region, considerably reduces the dust, smoke and other pollutants.

5. Stringent Government Action:

Government should take strin­gent action against industries which discharge higher amount of pollutants into the environment than the level prescribed by Pollu­tion control panel.

6. Assessment of the Environmental Impacts:

Environmental impact assessment should be administered regularly which intends to identify and evaluate the potential and harmful impacts of the industries on natural eco-system.

7. Strict Implementation of Environmental Protection Act:

Environment Protection Act should be strictly followed and the destroyer of the environment should be strictly punished.

Key takeaways

3.5 Service Sector: Recent trends

Introduction

The services sector, with around 60 per cent contribution to the Gross Domestic Product (GDP) in 2014-15, has made rapid strides during the past decade and a half to emerge because the largest and one of the fastest-growing sectors of the economy. The services sector isn't only the dominant sector in India’s GDP, but has also attracted significant foreign investment flows, contributed significantly to exports also as provided large-scale employment.

India’s services sector covers a good sort of activities like trade, hotels and restaurants, transport, storage and communication, financing, insurance, real estate, business services, community, social and personal services, and services related to construction.

Market size

The services sector contributed US $ 783 billion to the 2014-15 GDP (at constant prices) growing at CAGR of 9 per cent, faster than the general GDP CAGR of 6.2 per cent in the last four years.

Out of overall services sector, the sub-sector comprising financial services, real estate and professional services contributed US$ 305.8 billion or 20.5 per cent to the GDP. The sub-sector of community, social and private services contributed US$ 188.2 billion or 12.6 per cent to the GDP. The third-largest sub-segment comprising trade, repair services, hotels and restaurants contributed nearly US $ 187.9 billion or 12.5 per cent to the GDP, while growing the fastest at 11.7 per cent CAGR over the period 2011-12 to 2014-15.

Composition of service sector in India

In India, the national income classification given by Central Statistical Organization is followed. In the national income Accounting in India, service sector includes the following:

1. Trade, hotels and restaurants:

a. Trade

b. Hotels and restaurants

2. Transport, storage and communication

a. Railways

b. Transport by other means

c. Storage

d. Communication

3. Financing, Insurance, property and Business Services

a. Banking and Insurance

b. Realty, Ownership of Dwellings and Business Services

4. Community, Social and private services

a. Public Administration and Defense (PA & D)

b. Other services

Performance of services sector in India

• Sectoral Composition of GDP Growth:

The analysis of the sectoral composition of GDP and employment for the period 1950-2000 brings out the very fact that there has taken place ‘tertiarization’ of the structure of production and employment in India.

The service sector output increased at a rate of 6.63% per annum in the period 1980-81 to 1989-90 (i.e. pre-reform period) compared with 7.71% once a year in the period 1990-91 to 1999-2000 (i.e. post- reform period). The share of this sector in GDP further increased to 55.1% in 2006-07. Currently it's contributing around 60% of Indian GDP.

• Employment scenario

The sectoral distribution of workforce in India during the amount 1983 to 2004-05 reveals that the structural changes in terms of employment are slow in India because the primary sector continued to soak up 56.67% of the entire workforce even in 2004-05, followed by tertiary and industrial sectors (24.62% and 18.70%) respectively. The service sector was contributing about 28% total employment in the whole country in 2012.

It is important to means that within the services sector employment rate of growth is highest in finance, insurance, and business services, followed by trade, hotels and restaurants and transport etc. The community social and private services occupy the last rank in growth rates of employment.

Policy measures for the development of the services sector

In post-1991 period, there have been several measures undertaken by the govt. To develop services sector, especially through deregulation of some sub-sectors of services sector. Foreign Direct Investment (FDI) varying from 26 per cent (in print media) to 100% in information technology (IT) sector, business process outsourcing (BPOs), e-commerce activities, infrastructure etc.) has been permitted.

A large number of steps like launching of National Telecom Policy 1994, New Telecom Policy 1999, and National Telecom Policy-2012, Broad Band Policy 2004 etc. were undertaken. Additionally, to this, a number of promotional measures are taken up in IT and ITES (Information Technology Enabled Services) segment, trade, tourism, banking and insurance and land sectors.

The Government of India announced that all the main tourist spots like Sarnath, Bodhgaya and TajMahal will have a Wi-Fi facility as a part of Digital India initiative. Besides, the govt. Has started providing free Wi-Fi service at Varanasi Ghats.

The Government of India has launched an initiative to make 100 smart cities also as Atal Mission for Rejuvenation and concrete Transformation (AMRUT) for 500 cities with an outlay of Rs 48,000 crore (US$ 7.47 billion) and Rs 50,000 crore (US$ 7.78 billion) crore respectively. Smart cities are satellite towns of larger cities which can contains modern infrastructure and can be digitally connected. The program was formally launched on June 25, 2015. The phase i for Smart City Kochi (SCK) was launched in July 2015 which can be built on a complete area of 650,000 sq. Ft., having a floor space greater than 100,000 sq. Ft. Besides, it'll also generate a complete of 6,000 direct jobs within the IT sector.

Problems/ challenges ahead

The sustainability of impressive growth of Indian economy has been questioned in the wake of some challenges in the sort of lack of social infrastructure, physical infrastructure, IT infrastructure, agricultural and industrial sector reforms, etc. Besides, challenges in the field of IT and ITES like rising labor costs, rapid growth in demand for talented manpower/quality staff, high rate of attrition, outsourcing backlash etc. are another limiting factors. The expansion of IT and ITES has social, economic, health, ethical and environmental implications also.

The problem gets further compounded due to the entry of latest species of services (like IT, ITES etc.) and lack of development of concepts on the one hand and non-inclusion of unpaid households on the opposite. Further, quality of every unit of the same service varies from the other. Therefore, it's too difficult to attain the same level of output in terms of quality has been acknowledged. Further, quality improvements stemming from the application of latest technologies are extremely hard to measure.

Prospects for growth in the service sector

One of the main drivers of service sector growth in the post globalization era in India is the IT and ITES sectors. That’s why NASSCOM (2005) says that, “The IT and BPO industries can become major growth engines for India, as oil is for Saudi Arabia and electronics and engineering are for Taiwan. Saudi Arabia’s oil exports accounted for 46% of GDP in 2004; Taiwan’s electronics and engineering exports accounted for 17% of GDP in the same year. India’s IT and BPO industries could account for 10-12% of India’s GDP by 2015.” (NASSCOM, 2005, p.80).

Recent trends in service sector

1. General Trends

• Service sector contributes one-third of global GVA, half of global employment, one-fifth of worldwide trade and around half global FDI flows.

• Currently, United States is world’s largest service provider, followed by China and Japan at second and third position. In terms of services GVA, India is 10th largest economy.

• Global service sector has grown by 3.0% between 2001-08 {pre-crisis period} and 2.5% then {post-crisis period}. However, India showed the fastest service sector growth with a CAGR of 8.6 per cent during 2008-14. In 2014 India’s service sector grew at 10.3 per cent was noticeably above that of China at 8.0 per cent.

• In 21 states and union territories, Service Sector may be a dominant economic sector contributing more than half the gross state domestic product (GSDP). In all states except Sikkim and Arunachal Pradesh, Service Sector contributes over 40% of the GSDP. This proves that India is really a service economy.

• Delhi is India’s top service provide state followed by Maharashtra.

• In 2014-15, while total FDI equity inflows grew by 27.3%, FDI equity inflows to the services sector grew by a whopping 70.4%.

• The share of India’s services exports in global services exports at 3.2% in 2014 is nearly double its share of merchandise exports in global merchandise exports at 1.7%.

2. Tourism including Medical Tourism

• Maximum numbers of tourists to India come from France and united states.

• India includes a very small tourism industry. India’s share in International tourism receipts (ITR) is merely 0.7%. In terms of ITRs, India’s share is 1.6%, which is less than that of China at 4.6%. However, the growth in tourism has been in double digits in recent years. Resilience to tourism industry in India is provide by its domestic sector.

• The Government of India has introduced e-TV (E-Tourist Visa) facility for the citizens of 113 countries at 16 air ports. The govt has also launched revision of visa fee on principle of reciprocity.

• To promote medical tourism in the country, government has launched India’s Healthcare Portal and Advantage Health Care India.

3. Shipping Sector

• Transportation by sea shares 95% of India’s trade by volume and 68% by value.

• India features a large merchant shipping fleet but share in world dead weight tonnage is merely 0.9% {July 2015}.

• The shipping sector has been in trouble in recent years because of lack of demand; aging of shipping fleet etc. Both global and Indian services and merchandise trade growth has been in negative territory in 2015.

• Among the measures to grow Indian tonnage, the subsequent are worth note:

• Making fuel tax free for all Indian flag coastal vessels engaged in container trade

• Giving tax benefit to Indian seafarers working on Indian ships, thereby making the value of personnel more competitive

• Removing obstacles in the smooth implementation of the India Controlled Tonnage (ICT) scheme which allows Indian companies to directly own ships in foreign flags

• Easing many procedural compliance issues like ship registration, procuring chartering permission and payment of chartering fees online.

• India also continues to be a leading ship-breaking destination. However, the ship-breaking sector is in turmoil with the typical scrap price for tankers and bulkers. Import of cheap Chinese steel billets is one among the reasons for this, due to falling demand for scrap ships. Further, the International Maritime Organization’s (IMO)Hong Kong Convention on Recycling in 2009 to regulate the complete practice of ship recycling. The convention will require Indian ship breaking yards to make facilities. Though, India has not yet signed the convention, there has already been voluntary compliance by some Indian yards to ensure that business isn't lost, though it's hurting their bottom lines.

THE OTHER MEASURES INCLUDE:

Development of coastal shipping as an end-to-end supply chain integration of inland water transport (IWT) and coastal route development of regional centres to get cargo for coastal traffic development of the domestic cruise industry and promotion of lighthouse tourism.

Various actions are being taken to develop IWT infrastructure, particularly the implementation of the JalMarg Vikas Project.

1. JalMarg Vikas Project

National Waterway-1 (NW-1) could be a waterway passing through Uttar Pradesh, Bihar, Jharkhand and West Bengal, potentially serving the main cities of Haldia, Howrah, Kolkata, Bhagalpur, Patna, Ghazipur, Varanasi, Allahabad and their industrial hinterlands including several industries located along the Ganga basin. The ‘JalMargVikas’ (National Waterway-1) project, which envisages developing a fairway between 1,620 km Allahabad and Haldia stretch, has begun with a $3.5 million funding from the world Bank.

2. Port Services

• The cargo traffic of Indian ports increased by 8.2 per cent in 2014-15, with traffic at non-major ports increasing at a faster rate than at major ports.

• In India’s Maritime Agenda, the target for the year 2020 is 3130 million tons of port capacity with an investment of roughly Rs.2.96 Lakh Crore. Over 50 per cent of this capacity is to be created within the non-major ports.

• Some of the initiatives by the govt in port services are deepening draft to 18 meters to handle large and modern vessels, establishing dry ports and providing financial assistance to acquire pollution response equipment.

3. IT –BPM Services

• The Indian IT-BPM { Information Technology – Business process management ) industry consists of IT services, which constitute the most important segment with a share of around 52%, followed by BPM with share of around 20%, software products, engineering research and development (ER&D) and product development, which together account for around 19% share, and hardware with around 10% share.

• The industry currently employs quite 3.7 million people and is India’s largest private sector employer.

• The technology industry is facing problems with multiple disruptive digital technologies. It's also being negatively impacted by the alarming trend of increased protectionism and resulting barriers to free movement of skill and data. Total revenue (exports plus domestic) of the IT-BPM sector for 2015-16 including hardware is predicted grow at 8.3% over the previous year.

4. Research and Development Services

• The R&D sector contributes 1.4 per cent of GDP (old method). However, consistent with the global Competitiveness Report 2015-16, India’s capacity for innovation has been less than that of the many countries just like the USA, the UK, South Korea, and even South Africa.

• In terms of patents granted per million population, India fares badly compared to other BRICS countries. In terms of company spending on R&D also, India ranks below China and other countries.

• Only in terms of availability of scientists and engineers, does India score better or is adequate to other BRICS countries.

5. Measures by the govt. To push R&D include

• The weighted tax write-off of 200 per cent for R&D expenditure and announcement for establishment of the Atal Innovation Mission (AIM) within NITI aayog.

• Self Employment and Talent Utilization (SETU) programme

• IMPRINT (Impacting Research Innovation and Technology.

6. Consultancy Services

• Consultancy services are emerging as one of the fastest growing service segments in India, cutting across different sectors with some overlapping.

• A large number of consultancy firms and individual consultants are operating in India at various levels across the sectors.

• Though there are huge opportunities for the expansion of the Indian consulting industry, there are some key inhibitors like low brand equity, inadequate international experience of Indian consultants working abroad, lack of local presence, lack of strategic tie-ups, low competency image, lack of market intelligence on consulting opportunities abroad and lack of a strong competency framework of consultants that improves quality in delivery of consulting assignments.

• Addressing these issues may help in increasing the worldwide market share of the Indian consultancy Industry.

7. Land and Housing

• Real estate and ownership of dwelling is a vital contributor to the Indian economy. It constituted 8.0 per cent of India’s GVA in 2014-15 and grew by 9.1 per cent.

• It also generates significant income and employment due to large forward and backward linkages through creation of demand in the input sectors and land services.

• The sector has grown at a CAGR of 8.1 per cent since 2011-12. However, the development sector has witnessed a big slowdown in previous couple of years. The slowdown in sales in the housing sector has resulted during a sharp increase in the inventory of unsold housing units, especially in the northern and western regions.

• Despite weak sales and rising inventory, the housing prices in many cities and towns have increased in 2015. High level of debt investment, while providing interim relief to the sector, poses a high refinancing risk if the housing sales still remain weak.

8. Internal Trade

• Internal trade refers to the movement of products and services across different geographical regions in the country. It includes self-employed and persons engaged in both wholesale and retail trade.

• Presently internal trade is governed by a diversity of controls, multiple organizations and a plethora of laws and this has resulted during a fragmented market, hindering the free flow of products within the country, higher transportation costs and generally a lower level of efficiency and productivity.

• Unfettered flow of goods and services is an important pre-requisite for building a common market which will promote growth, trade across regions and also enable specialization and better levels of economic efficiency.

9. Media and Entertainment Services

• The industry has recorded unprecedented growth over the last two decades, making it one among the fastest growing industries in India.

• Digital advertising and gaming, which grew by 44.5% and 22.4% respectively in 2014, are projected to drive the expansion of this sector in the coming years.

• The Government of India has begun an ambitious exercise to digitize its cable network in four phases, resulting in an entire cut of analog TV services by 31 December 2016. So as to attain universal digitalization by 2017, the govt. Is implementing the Broadcasting Infrastructure Network Development Scheme. This is often a 12th plan scheme for modernization and upgradation of PrasarBharati – the public broadcaster.

• India is world’s biggest producer of films, with more than 1000 films annually in all languages. During 2015-16 (April-December), the govt. Has accorded permission for 25 foreign productions to shoot films in India. It’s recently accorded administrative approval for fixing of the Film Facilitation Office (FFO) with a view to promoting and facilitating film shootings by foreign filmmakers in India.

• In order to deal with the issue of skilling in the animation, gaming and visual effects sector, the govt. Is in the process of fixing a National Centre of Excellence in Animation, Gaming and Visual Effects (NCOE).

10. Postal Services

Out of 1.55 lakh post offices, 1.39 lakh are in rural areas and the remaining in urban areas.

• The Department of Posts plays an important role in disbursing wages to mahatma Gandhi National Rural Employment Guarantee Scheme (MGNREGS) beneficiaries.

• Towards financial inclusion, the number of post office savings bank (POSB) accounts has increased from 30.86 crore to 33.97 crore.

• More than 80 lakh Sukanya Sam RiddhiYajna accounts are opened with a cumulative investment of over Rs.2,900 crore since the launch of the scheme on 22 January 2015.

11. Aviation services

• The prospects for Indian aviation services have improved following the fall in prices of aviation fuel, which accounts for nearly 40 per cent of the operating expenses of airlines in India; liberalization of FDI policies in civil aviation; and powerful growth in passenger traffic which is predicted to continue in the near future.

3.6 Role and growth in Healthcare and Tourism Industry

Role and growth of health care industry

INTRODUCTION

Healthcare has become one of India’s largest sectors - both in terms of revenue and employment. Healthcare comprises hospitals, medical devices, clinical trials, outsourcing, telemedicine, medical tourism, health insurance and medical equipment. The Indian healthcare sector is growing at a brisk pace because of its strengthening coverage, services and increasing expenditure by public also private players.

Indian health care delivery system is categorized into two major components - public and personal. Thegovt, i.e. public healthcare system comprises limited secondary and tertiary care institutions in key cities and focuses on providing basic healthcare facilities in the sort of primary healthcare centres (PHCs) in rural areas. The private sector provides majority of secondary, tertiary and quaternary care institutions with a significant concentration in metros, tier I and tier II cities.

India's competitive advantage lies in its large pool of well-trained medical professionals. India is additionally cost competitive compared to its peers in Asia and Western countries. The cost of surgery in India is about one-tenth of that in the US or Western Europe. India ranks 145th among 195 countries in terms of quality and accessibility of healthcare

MARKET SIZE

The healthcare market can increase three-fold to Rs 8.6 trillion (US$ 133.44 billion) by 2022.

Indian medical tourism market is growing at the speed of 18 per cent year on year and is predicted to succeed in US$ 9 billion by 2020. There's a big scope for enhancing healthcare services considering that healthcare spending as a percentage of Gross Domestic Product (GDP) is rising. The government’s expenditure on the health sector has grown to 1.4 per cent in FY18E from 1.2 per cent in FY14.

Health insurance is gaining momentum in India. Gross direct premium income underwritten by health insurance grew at 14.70 per cent y-o-y to Rs 42,328.18 crore (US$ 6.06 billion) in FY20 (up to January 2020).

INVESTMENT

The hospital and diagnostic centers attracted Foreign Direct Investment (FDI) worth US$ 6.625 billion between April 2000 and December 2019, consistent with data released by the Department for Promotion of Industry and Internal Trade (DPIIT). a number of the recent investments in the Indian healthcare industry are as follows:

The value of merger and acquisition (M&A) deals in hospital sector jumped by record 155 percent at Rs 7,615 crore (US$ 1.09 billion) in FY19.

In August 2019, Microsoft India and Apollo Hospitals Group entered in agreement to line up a National Clinical Coordination Committee for AI-powered cardiovascular disease Risk Score API.

In January 2019, National Company Law Tribunal (NCLT) approved Tri-County Premier Hearing Services Inc’s attempt to acquire Bhilai Scan and Research Pvt Ltd (BSR) Diagnostics Ltd for Rs 67 crore (US$ 9.29 million).

Healthcare sector in India witnessed 23 deals worth US$ 679 million in H12018.

India and Cuba have signed a Memorandum of Understanding (MoU) to extend cooperation in the areas of health and medicine, consistent with Ministry of Health and Family Welfare, Government of India.

Fortis Healthcare has approved the de-merger of its hospital business with Manipal Hospital Enterprises. TPG and DrRanjan Pal could invest Rs 3,900 crore (US$ 602.41 million) in Manipal Hospital Enterprise.

GOVERNMENT INITIATIVES

• Some of the main initiatives taken by the govt of India to push Indian healthcare industry are as follows:

• In Union Budget 2020-21, Rs 35,600 crore (US$ 5.09 billion) has been allocated for nutrition-related programs.

• The government has announced Rs 69,000 crore (US$ 9.87 billion) outlay for the health sector that's inclusive of Rs 6,400 crore (US$ 915.72 million) for PMJAY in Union Budget 2020-21.

• The Government of India aims to extend healthcare spending to 3 percent of the Gross Domestic Product (GDP) by 2022.

• In February 2019, the govt of India established new All India Institute of Medical Sciences (AIIMS) at Manethi, District Rewari, Haryana at a price of Rs 1,299 crore (US$ 180.04 million).

• The Union Cabinet approved setting up of National Nutrition Mission (NNM) with a three-year budget of Rs 9,046 crore (US$ 1.29 billion) to watch, supervise, fix targets and guide the nutrition related interventions across ministries.

• On September 23, 2018, Government of India launched Pradhan Mantri Jan Arogya Yojana (PMJAY), to supply insurance worth Rs 500,000 (US$ 7,124.54) to over 100 million families every year.

• In August 2018, the govt of India has approved Ayushman Bharat-National Health Protection Mission as a centrally Sponsored Scheme contributed by both center and government at a ratio of 60:40 for all States, 90:10 for hilly North Eastern States and 60:40 for Union Territories with legislature. The middle will contribute 100 per cent for Union Territories without legislature.

• The Government of India has launched Mission Indra Dhanush with the aim of improving coverage of immunization in the country. It aims to realize at least 90 per cent immunization coverage by December 2018 which can cover unvaccinated and partially vaccinated children in rural and urban areas of India.

ACHIEVEMENTS

Following are the achievements of the government:

• As of July 2019, around 125.7 million families have enrolled as beneficiaries under Pradhan Mantri Jan Arogya Yojana (PMJAY). The scheme has enrolled 16,085 hospitals, including 8,059 private hospitals and 7,980 public hospitals. It to incorporate 19 Ayush packages in the treatment scheme

• As of September 2019, about 50 lakh people have received free treatment under the Ayushman Bharat - Pradhan Mantri Jan Arogya Yojana.

• The number medical colleges in India increased to 529 in FY19 from 381 in FY13.

• According to Sample Registration System Bulletin-2016, India has registered a 26.9 per cent reduction in Maternal Mortality Ratio (MMR) since 2013.

ROAD AHEAD

India may be a land filled with opportunities for players in the medical devices industry. India’s healthcare industry is one among the fastest growing sectors and it's expected to succeed in $280 billion by 2020. The country has also become one of the leading destinations for high-end diagnostic services with tremendous capital investment for advanced diagnostic facilities, thus catering to a greater proportion of population. Besides, Indian medical service consumers became more conscious towards their healthcare upkeep.

Indian healthcare sector is far diversified and is filled with opportunities in every segment which incorporates providers, payers and medical technology. With the rise in the competition, businesses are looking to explore for the newest dynamics and trends which can have positive impact on their business. The hospital industry in India is forecasted to extend to Rs 8.6 trillion (US$ 132.84 billion) by FY22 from Rs 4 trillion (US$ 61.79 billion) in FY17 at a CAGR of 16-17 per cent.

The Government of India is getting to increase public health spending to 2.5 per cent of the country's GDP by 2025.

India's competitive advantage also lies in the increased success rate of Indian companies in getting Abbreviated New Drug Application (ANDA) approvals. India also offers vast opportunities in R&D also as medical tourism. To sum up, there are vast opportunities for investment in healthcare infrastructure in both urban and rural India.

ADVANTAGES INDIA FROM HEALTH CARE

Role and growth of tourism industry

INTRODUCTION

Tourism and hospitality are a vital parameter of socio-cultural identity and heritage of a country. In the era of globalization tourism and hospitality enhances the economic growth by job creation, source of foreign exchange and development of regions with potential for tourism.

Tourism and hospitality sector contribute 6.8% in India's GDP. For a rustic with 30 world heritage sites and an upscale culture, tourism and hospitality industry has great potential to reinforce tourist flow and accelerate economic growth because of multiplier effect of tourism on job creation. The descriptive research design is employed for the study. The study examined the correlation of economic variables on foreign tourist arrivals. The paper evaluated the success stories of Kerala and Gujarat as a case of focused approach towards tourism. Secondary source of knowledge is employed to examine the trend of tourism and its role in economic growth of the country. Gross domestic capital formation was found to possess highest correlation with foreign tourist arrivals. Rate of growth of foreign tourist arrival is found to have significant positive correlation with rate of growth of service sector in India and gross state domestic product of Kerala and Gujarat.

ROLE OF TOURISM INDUSTRY

According to World Travel and Tourism Council (2014), the contribution of travel and tourism in world GDP is estimated to extend from 9.5% of GDP in 2013 to 10.3% of GDP in 2024 (WTTC, 2014).

Tourism and hospitality industry contribute 6.8% of GDP of India, contributes 7.7% in total employment generated and provides foreign exchange of US$18.13 billion (IBEF, 2014). The tourism and hospitality sector are that the third largest source of foreign exchange for India (makeinindia, 2015). Market size of tourism and hospitality sector is estimated to extend from US$ 122.1 billion in 2013 to US$ 418.9 billion in 2022 (IBEF, 2014). The investment in tourism creates more jobs as compared to other sectors of economy. An investment of Rs. 10 lakhs in tourism sector is estimated to make 89 jobs in hospitality industry as compared to 45 jobs in agriculture and 13 jobs in manufacturing sector (Planning Commission, 2007).

Hotel industry generates revenues of US$ 400-500 billion annually (IBEF, 2015). In India tourism and hospitality has emerged as an industry with rise in number of foreign tourists. As shown in figure 1, the arrivals of foreign tourists in India have grown at a CAGR of 7.85% from 2005 to 2014.

GROWTH OF TOURISM INDUSTRY

Early GROWTH AND DEVELOPMENT

The first conscious and organized efforts to push tourism in India were made in 1945 when a committee was created by the govt under the Chairmanship of Sir John Sargent, the then Educational Adviser to the govt of India (Krishna, A.G., 1993). Thereafter, the development of tourism was taken up in a planned manner in 1956 coinciding with the Second Five Year Plan. The approach has evolved from isolated planning of single unit facilities in the Second and Third Five Year Plans. The Sixth Plan marked the start of a new era when tourism began to be considered a serious instrument for social integration and economic development.

But it was only after the 80’s that tourism activity gained momentum. The govt took several significant steps. A National Policy on tourism was announced in 1982. Later in 1988, the National Committee on Tourism formulated a comprehensive plan for achieving a sustainable growth in tourism. In 1992, a National Action Plan was prepared and in 1996 the National Strategy for Promotion of Tourism was drafted. In 1997, the New Tourism Policy recognizes the roles of Central and State governments, public sector undertakings and the private sector in the development of tourism were. The requirement for involvement of Panchayati Raj institutions, local bodies, non-governmental organizations and the local youth in the creation of tourism facilities has also been recognized.

PRESENT SITUATION AND FGROWTH OF TOURISM IN INDIA

Today tourism is the largest service industry in India, with a contribution of 6.23% to the national GDP and providing 8.78% of the entire employment. India witnesses over 5 million annual foreign tourist arrivals and 562 million domestic tourism visits. The tourism industry in India generated about US$100 billion in 2008 which is expected to increase to US$275.5 billion by 2018 at a 9.4% annual rate of growth. The Ministry of Tourism is that the nodal agency for the development and promotion of tourism in India and maintains the "Incredible India" campaign.

According to World Travel and Tourism Council, India will be a tourism hotspot from 2009-2018, having the highest 10-year growth potential. As per the Travel and Tourism Competitiveness Report 2009 by the world Economic Forum, India is ranked 11th in the Asia Pacific region and 62nd overall, moving up three places on the list of the world's attractive destinations. It's ranked the 14th best tourist destination for its natural resources and 24th for its cultural resources, with many World Heritage Sites, both natural and cultural, rich fauna, and strong creative industries in the country. India also bagged 37th rank for its air transportation network. The India travel and tourism industry ranked 5th in the long-term (10-year) growth and is expected to be the second largest employer in the world by 2019. The 2010 Commonwealth Games in Delhi are expected to significantly boost tourism in India further.

Moreover, India has been ranked the "best country brand for value-for-money" in the Country Brand Index (CBI) survey conducted by Future Brand, a leading global brand consultancy. India also claimed the second place in CBI's "best country brand for history", also as appears among the top 5 in the best country brand for authenticity and art & culture, and the fourth best new country for business. India made it to the list of "rising stars" or the countries that are likely to become major tourist destinations in the next five years, led by the United Arab Emirates, China, and Vietnam.

TOURIST ATTRACTIONS IN INDIA:

India is a country known for its lavish treatment to all or any visitors, no matter where they come from. Its visitor-friendly traditions, varied life styles and cultural heritage and vibrant fairs and festivals held abiding attractions for the tourists. The opposite attractions include beautiful beaches, forests and wild life and landscapes for eco-tourism; snow, river and mountain peaks for adventure tourism; technological parks and science museums for science tourism; centres of pilgrimage for spiritual tourism; heritage, trains and hotels for heritage tourism. Yoga, Ayurveda and natural health resorts and hill stations also attract tourists.

The Indian handicrafts particularly, jewellery, carpets, leather goods, ivory and brass work are the most shopping items of foreign tourists. It's estimated through survey that nearly forty per cent of the tourist expenditure on shopping is spent on such items.

Despite the economic slowdown, medical tourism in India is that the fastest growing segment of tourism industry, consistent with the marketing research report “Booming Medical Tourism in India”. The report adds that India offers an excellent potential in the medical tourism industry. Factors like low cost, scale and range of treatments provided within the country increase its attractiveness as a medical tourism destination.

INITIATIVES TO SPICE UP TOURISM:

Some of the recent initiatives taken by the govt to boost tourism include grant of export house status to the tourism sector and incentives for promoting private investment in the sort of income tax exemptions, interest subsidy and reduced import duty. The hotel and tourism-related industry has been declared a high priority industry for foreign investment which entails automatic approval of direct investment up to 51 per cent of foreign equity and allowing 100 per cent non-resident Indian investment and simplifying rules regarding the grant of approval to travel agents, tour operators and tourist transport operators.

The first-ever Indian Tourism Day was celebrated on January 25, 1998. The Year 1999 was celebrated as Explore India Millennium Year by presenting a spectacular tableau on the cultural heritage of India at the Republic Day Parade and organizing India Tourism Expo in New Delhi and Khajuraho. Moreover, the campaign ‘Visit India Year 2009’ was launched at the International Tourism Exchange in Berlin, aimed to project India as a beautiful destination for holidaymakers. The govt. Joined hands with leading airlines, hoteliers, holiday resorts and tour operators, and offered them a large range of incentives and bonuses during the period between April and December, 2009.

FUTURE PROSPECTS:

According to the most recent Tourism Satellite Accounting (TSA) research, released by the world Travel and Tourism Council (WTTC) and its strategic partner Oxford Economics in March 2009:

• The demand for travel and tourism in India is predicted to grow by 8.2 per cent between 2010 and 2019 and can place India at the third position in the world.

• India's travel and tourism sector is predicted to be the second largest employer in the world, employing 40,037,000 by 2019.

• Capital investment in India's travel and tourism sector is predicted to grow at 8.8 per cent between 2010 and 2019.

• The report forecasts India to urge capital investment worth US$ 94.5 billion within the travel and tourism sector in 2019.

• India is projected to become the fifth fastest growing business travel destination from 2010-2019 with an estimated real rate of growth of seven .6 per cent.

CONSTRAINTS:

The major constraint in the development of tourism in India is that the non-availability of adequate infrastructure including adequate air seat capacity, accessibility to tourist destinations, accommodation and trained manpower in sufficient number.

Poor visitor experience, particularly, because of inadequate infrastructural facilities, poor hygienic conditions and incidents of touting and harassment of tourists in some places are factors that contribute to poor visitor experience.

Impacts of tourism in India

Tourism industry in India has several positive and negative impacts on the economy and society. These impacts are highlighted below.

POSITIVE IMPACTS

1. Generating Income and Employment: Tourism in India has emerged as an instrument of income and employment generation, poverty alleviation and sustainable human development. It contributes 6.23% to the national GDP and 8.78% of the entire employment in India. Almost 20 million people are now working within the India’s tourism industry.

2. Source of foreign exchange Earnings: Tourism is a vital source of foreign exchange earnings in India. This has favorable impact on the balance of payment of the country. The tourism industry in India generated about US$100 billion in 2008 and that is predicted to increase to US$275.5 billion by 2018 at a 9.4% annual rate of growth.

3. Preservation of National Heritage and Environment: Tourism helps preserve several places which are of historical importance by declaring them as heritage sites. As an example, the TajMahal, the QutabMinar, Ajanta and Ellora temples, etc, would have been decayed and destroyed had it not been for the efforts taken by Tourism Department to preserve them. Likewise, tourism also helps in conserving the natural habitats of the many endangered species.

4. Developing Infrastructure: Tourism tends to encourage the development of multiple-use infrastructure that benefits the host community, including various means of transports, health care facilities, and sports centers, additionally to the hotels and high-end restaurants that cater to foreign visitors. The event of infrastructure has in turn induced the event of other directly productive activities.

5. Promoting Peace and Stability: Honey and Gilpin (2009) suggests that the tourism industry can also help promote peace and stability in developing country like India by providing jobs, generating income, diversifying the economy, protecting the environment, and promoting cross-cultural awareness. However, key challenges like adoption of regulatory frameworks, mechanisms to scale back crime and corruption, etc, must be addressed if peace-enhancing benefits from this industry are to be realized.

NEGATIVE IMPACTS

1. Undesirable Social and Cultural Change: Tourism sometimes led to the destruction of the social fabric of a community. The more tourists coming into a place, the more the perceived risk of that place losing its identity a good example is Goa. From the late 60's to the early 80's when the Hippy culture was at its height, Goa was a haven for such hippies. Here they came in thousands and changed the whole culture of the state leading to a rise in the use of drugs, prostitution and human trafficking. This had a ripple effect on the country.

2. Increase Tension and Hostility: Tourism can increase tension, hostility, and suspicion between the tourists and therefore the local communities when there's no respect and understanding for each other’s culture and way of life. This may further cause violence and other crimes committed against the tourists. The recent crime committed against Russian tourist in Goa is a case in point.

3. Creating a way of Antipathy: Tourism brought little benefit to the local community. In most all-inclusive package tours quite 80% of travelers’ fees attend the airlines, hotels and other international companies, to not local businessmen and workers. Moreover, large hotel chain restaurants often import food to satisfy foreign visitors and rarely employ local staff for senior management positions, preventing local farmers and workers from reaping the benefit of their presence. This has often created a sense of antipathy towards the tourists and the government.

4. Adverse Effects on Environment and Ecology: one among the most important adverse effects of tourism on the environment is increased pressure on the carrying capacity of the ecosystem in each tourist locality. Increased transport and construction activities led to large scale deforestation and destabilization of natural landforms, while increased tourist flow led to increase in solid waste dumping also as depletion of water and fuel resources. Flow of tourists to ecologically sensitive areas resulted in destruction of rare and endangered species thanks to trampling, killing, disturbance of breeding habitats. Noise pollution from vehicles and public address systems, water pollution, vehicular emissions, untreated sewage, etc. even have direct effects on bio-diversity, ambient environment and general profile of tourist spots.

Key takeaways-

NEWS

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