The Hindu Business Line : Planning still relevant in coalition era: Pant

THE role and remit of the Plan panel continue to be "relevant in the evolution of our polity, coalition government at the Centre with different political parties ruling the States where its coordinating capacity could be of immense strength," the Planning Commission Deputy Chairman, Mr K.C. Pant, said here on Tuesday.

Talking to Business Line here, Mr Pant said that in the evolving economic scenario and political systems, "the Planning Commission should function in a manner which seems to be transparent, to be fair and to which all the players should consider as a reliable entity and to whom they could turn to solve their myriad problems."

Stating that the Planning Commission has many different divisions covering the entire gamut of government and storehouse of a vast database, Mr Pant said that all these could be brought to bear on current problems through this "unique institution which needs to be strengthened" and which "in my view could play a very important role.

"As the economic climate alters, reforms become important, the Planning Commission has been pushing up reforms in infrastructure domain, both in physical and social, so that the benefits of development could be broadly distributed in he process."

Mr Pant singled out Rashtriya Sam Vikas Yojana (RSVY) for backward development region in Bihar and Orissa with 100 per cent grant from Centre and empowered sub-committee on e-governance as the major initiatives of the Tenth Plan.

Besides, the Tenth Plan recognised the need to restructure, revitalise the existing vocational institutions, to fill in gaps and in due course a very wide cross-section of younger generation would be endowed with skills in services sector like computer training, accountancy and secretarial services.

"Employment exchanges could be placement agencies for linking institutes with employers" to absorb 91 per cent of workforce in the informal sector as formal sector provides only 9 per cent job.

Asked to comment on the recent RBI report suggesting improvements in the finances of the State governments, Mr Pant recalled that "we have been examining for quite some time the finances of States" as most of them were groaning under heavy debt burden mostly triggered off by the implementation of the Fifth Pay Commission implementation.

He said over the last three years, the introduction of core concept in Central plan allocation by the Plan panel had helped many a State not to ramp up its plan size but to take resources in sight to fund its annual plan.

Many States signed memorandum of understanding with the Plan panel and the Ministry of Finance, with the States slowly but surely accepting the need for fiscal discipline and these efforts had "a cumulative effect now," Mr Pant added.

On a possible debt relief strategy to States, he said that given the size of States' debt and its impact on their finances, the Plan panel does weigh several options even as the effect of the proposed package on the Central finances needs to be reckoned.

"Various proposals have been under consideration. We have not taken a decision. Unless I see the final option, unless the Plan panel takes a view, I won't like to talk on specifics" of debt relief strategy on the anvil for the States, Mr Pant added.

Mr Pant cited the case of how the Planning Commission has been pro-active on the power front.

There is a realisation all round that the loss of State electricity boards (SEBs) contributed materially to the worsening State finances and absence of power is "something which people begin to resent as it is not only the sufficiency of power but also the quality of power that is very important for industrial uses," Mr Pant noted.

In order to reduce the outstanding dues of SEBs, Mr Pant said, "interests on SEBs loans got partly written off and securitisation brought in, on the condition that henceforth they would pay.

"I am told that this has worked and the SEBs are paying. This brought a sense of discipline and there has been a scheme in which the money is being given for sub-transmission and distribution as well as movement towards reduction of losses and incentives for that."

The Electricity Act 2003 opened up the possibility of more players entering into both generation and distribution, he said adding that the most important step is the scheme to put meters at the sub-station level at 50-odd places and if this works properly, then revenue will start pouring in.

Power theft must be brought down and transmission and distribution losses would be cut down, Mr Pant said noting, "progress in the power sector is on the right lines".

He admitted that the mid-term appraisal of the Tenth Plan (2002-07), which would have been begun in April-May this year, got delayed because of elections and the exercise would start once the new government assumes office.