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To achieve a 10 per cent growth rate,
and sustain that over time, the Eleventh Five Year Plan will emphasise
investments in agriculture. Agricultural GDP has been growing (limping?)
along at 2 per cent since 1996. A new strategy, including one for a second
Green Revolution, is urgently needed to take India to the next level of
development. An analysis. Reducing rural unemployment will be a challenge. This can be achieved by increasing investment in agriculture. Agriculture's contribution to GDP has been falling sharply in the last few years. From four per cent in the second quarter of 2005-06, it has fallen to 1.7 per cent in this fiscal year's second quarter. The approach paper maintains that agricultural growth is key to inclusive growth. Lack of technology is seen as the major cause behind the deceleration in agricultural growth. Since the Green Revolution in the sixties there has been no major technological innovation, which could give fresh impetus to agricultural productivity. Growth in the long run depends on technological progress; hence steps need to be taken to strengthen agricultural research. Other issues on the agriculture agenda identified in the approach paper relate to the need for focused research in specific crops, farming systems and dry land farming practices. Improving farm productivity, enhanced facilities for credit, including revamping the cooperative credit system and initiatives to support agricultural diversification with effective marketing solutions are the other thrust areas. These initiatives discussed can raise the agricultural growth rate to 4 per cent in the eleventh five-year plan if carried out effectively. The Paper suggests that infrastructure investments will need to increase from 4.6 per cent of GDP to eight per cent in the Plan period. This entails broadly an outlay of about $350 billion for the infrastructure sector across the Plan period. One of the most crucial barriers to growth in the manufacturing sector is the absence of world-class infrastructure. Since the public sector resources are scarce the Plan advocates public and private partnership in infrastructure development. India will continue to depend on crude oil imports-which forms a huge part of our import bill. To achieve and sustain a high growth rate, India will have to look for cheaper sources of energy. The Plan aims to set up a robust energy R&D system to develop relevant technology and energy resources to enhance energy security and lead to energy independence in a cost effective way in the long run. The approach paper specifies not only a growth target but also a number of quantifiable socio-economic targets. It advocates the need to increase employment generation in the organised sector, reduce school drop out rates, infant mortality rates, and maternal mortality rates to attain an average growth of nine per cent in the next five years. The draft paper states that poverty alleviation and reducing gap between the haves and have-nots is a way to achieve a broad-based and inclusive growth. To realise the goals government will have to invest in education and availability of health services at the grass root level. In the last decade private expenditure in health services has increased manifolds but centre's spending in the health sector is just a fraction of that amount. In 2005-06, government expenditure in health services was 0.9 per cent of GDP. To raise the literacy levels in the country, the eleventh five-year plan emphasises more on education. It aims to increase public spending in education to six per cent of GDP. Fund allocation in centre's programmes to provide elementary education will be increased in the next five years.
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