The demand to create Inner Line Permit (ILP) system in Meghalaya has been rejected by the Union Government on grounds that the Constitution does not provide for extending the special provision to new areas.
The Government clarified that it was bound by Article 19 (D) of the Constitution which allows any Indian citizen to move freely throughout the territory of the country.
What is Inner Line Permit (ILP)?
ILP is an official travel document issued by an empowered State government to permit inward travel of an Indian citizen into a protected or restricted area for a limited period. It is mandatory for Indian citizens from outside those specific States to get permit for entering the protected State.
Why Inner Line Permit (ILP) is issued?
The ILP system empowers the government to regulate movement to certain areas located near the international borders. It is issued under the Bengal Eastern Frontier Regulation, 1873. At present, ILP is active in Arunachal Pradesh, Nagaland and Mizoram.
In context of Meghalaya, various organizations in the state have been demanding ILP system claiming the demography of the State is changing due to the intense inflow of people.
The RBI in its Macroeconomic and Monetary Developments Second Quarter Review 2013-14 said that markets in India face domestic uncertainties arsing from prolonged slowdown, falling corporate earnings and rising leverage, besides risks of political uncertainties associated with the electoral cycle.
Elections are to be held in Chhattisgarh, Madhya Pradesh, Mizoram, Rajasthan and Delhi in November-December 2013. National polls are also due before the term of the current Lok Sabha ends in May 2014.
In the recent past, India’s stock markets have faced volatility on the account of fears of a tapering of the monetary stimulus by the US Federal Reserve and concerns on domestic economy.
However, as per RBI, market uncertainties remain associated with how the debt ceiling issues will play out over the next several months and whether the nascent signs of recovery in the euro area sustain.
Global financial markets also got some relief with the US Federal Reserve decision to maintain the pace of its bond purchases and its signal that withdrawal of quantitative easing may take longer. However, RBI cautioned that the financial markets could be disrupted again when the extraordinary monetary accommodation in the advanced economies is withdrawn.
The Cabinet Committee on Economic Affairs (CCEA) approved continuation of the Scheme for Integrated Textile Parks (SITP) in the 12th five year plan. It also approved new projects for utilizing the balance of Rs 717 crore left in the 12thfive year plan allocation, after meeting committed liabilities of the sanctioned 61 parks.
What are the objectives of Scheme for Integrated Textile Parks (SITP)?
The main objective SITP is to provide the industry with world class infrastructure facilities for setting up their textile units. The product mix in these parks would include apparels and garments parks, hosiery parks, silk parks, processing parks, technical textiles including medical textiles, carpet parks and powerloom parks. SITP seeks green field investments in textiles sector on a public private partnership basis with the objective of setting up world class infrastructure for Textiles industry. Each Integrated Textile Park (ITP) would normally have 50 units. The number of entrepreneurs and the resultant investments in each ITP could vary from project to project.
The ITPs may also be set up in the Special Economic Zones (SEZs), in which case the special provisions of SEZs would be applicable for them. In case these are set up outside SEZs, proposal may be pursued with the Ministry of Commerce & Industry to declare the ITP as SEZ, if it is so desired.
The Scheme for Integrated Textile Parks (SITP) was approved in the 10th Five Year Plan (July 2005) to provide the industry with world-class infrastructure facilities for establishing their textile units by merging the erstwhile Apparel Parks for Exports Scheme (APES) and Textile Centre Infrastructure Development Scheme (TCIDS).
The ‘Scheme for Integrated Textile Parks (SITP)’ was launched by merging two schemes, namely, Apparel Parks for Exports Scheme (APES) and the Textiles Centre Infrastructure Development Scheme (TCIDS).
Role of State Government:
- Providing all the requisite clearances, wherever needed, for setting up the ITP and providing the necessary assistance for Power, Water and other utilities to the ITP.
- Assist in identification and procurement of suitable land.
- The State Government agencies like Infrastructure/Industrial Development Corporations may also participate in the projects by way of subscribing to the equity of SPV or by providing grants.
- The total project cost shall be funded through a mix of Equity/Grant – from the Ministry of Textiles, State Government, State Industrial Development Corporation, Industry, Project Management Consultant and Loan – from Banks/ Financial Institutions.
- The Government of India’s (GOI) support under the Scheme by way of Grant or Equity will be limited to 40% of the project cost subject to a ceiling of Rs. 40 crore.
- GOI support under the Scheme will be generally in the form of grant to the SPV unless specifically decided to be equity.
- The combined equity stake of GOI/State Government/State Industrial Development Corporation, if any, should not exceed 49% if the enhanced ratio of 40:60/49:51 is maintained.
- Central Government will be entitled to place a nominee on the Board of the Park as per scheme guidelines.
- GOI support will be provided @90% of the project cost subject to a ceiling of Rs. 40 crore for first two projects in the States of Arunachal Pradesh, Assam, Manipur, Meghalaya, Mizoram, Nagaland, Tripura, Sikkim and & Kashmir.
Rajan Committee’s new methodology to replace ‘special category’ status for devolution of funds to States
The panel set up by the government under the chairmanship of the then Chief Economic Advisor Raghuram Rajan (now RBI governor) has suggested ending the ‘special category’ criteria for providing additional assistance to poorer states.
Why did the government set up the Rajan Committee?
The Union Government set up Raghuram Rajan Committee amid demands for “special category” status by Bihar and some other status to get additional financial assistance from the Centre. The Committee was tasked to suggest methods for identifying backwardness of states using a variety of criteria and also to recommend how the criteria may be reflected in future planning and devolution of funds from the central government to the states.
What are the key recommendations of the Rajan Committee?
The Rajan Committee has made two key recommendations for devolution of funds to states. They are:
a) A new methodology based on a ‘Multi Dimensional Index (MDI)’.
Depending on the scores of the 28 states on the MDI, they will be split into 3 categories:
- Least developed
- Less developed
- Relatively developed
b) Each state should get a basic fixed allocation and an additional allocation depending on its development needs and development performance.
As per the Committee, these two recommendations, along with the allocation methodology, will effectively subsume what is now “Special Category” status.
According to the MDI scores:
- Least Developed states: Odisha, Bihar, Madhya Pradesh, Chhattisgarh, Jharkhand, Arunachal Pradesh, Assam, Meghalaya, Uttar Pradesh and Rajasthan.
- Less Developed states: Manipur, West Bengal, Nagaland, Andhra Pradesh, Jammu and Kashmir, Mizoram, Gujarat, Tripura, Karnataka, Sikkim and Himachal Pradesh.
- Relatively Developed states: Goa, Kerala, Tamil Nadu, Punjab, Maharashtra, Uttrakhand and Haryana.
The Department of Economic Affairs will soon examine the report and take necessary action.