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ECONOMIC REVIEW 2012 Slate Planning Board, Thirivananthapurain, Kerala, India March 2013 Volume One

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ECONOMIC REVIEW 2012 Slate Planning Board, Thirivananthapurain, Kerala, India March 2013 Volume One ECONOMIC REVIEW 2012 Slate Planning Board, ThiRivananthapurain, Kerala, India March 2013 Volume One \ V V, V V \ FOR REFER^f^CE^NLY ECONOMIC REVIEW 2012 State Planning Board, Thiruvananthapuram, Kerala, India March 2013 Volume One NUEPA DC ■illlillllU D14983 ( C ^ y:rtucational Plann/no Documentation FOREWORD T his year’s Economic Review attempts to capture economic progress in the State in a more analytical, yet user friendly format. The Review relies on innumerable sources of government information and serves as a credible and comprehensive account of the economic progress of the State. Volume 1 of the Review provides a thematic look at various economic sectors and brings out challenges as well as the accomplishments of various government institutions engaged in the provision of public goods and services. This is complemented by Volume 2, which provides time series and cross sectional data on state and national level economic parameters. Kerala is one of the most globalized States in India and hence the faltering growth of several trade partners does have a major impact on Kerala’s own growth prospects. Kerala is also dependent to a great extent on other States of India for key essentials such as food, fertilizers, most manufactured goods and basic industrial pre-requi­ sites such as coal, cement, steel, crude oil, natural gas and electricity. High food inflation and hike in fuel prices tend to aggravate Kerala’s developmental problems. Under the circumstances, Kerala’s performance in 2011-12 and 2012-13 has to be viewed against the global and national growth scenario. Kerala’s growth in GSDP as well as per capita income growth, even without factoring in non-resident remittances, was significantly higher than the national average in 2011-12. Kerala’s achievements in attaining high human development indicators has put the State way ahead of other Indian States and on par with developed economies in critical areas such as literacy, health care, gender consciousness, labour rights and participative governance. These strengths can be leveraged further by understand­ ing the changing aspirations of the people in the light of global dynamics. Second generation reforms have been introduced to focus not just on literacy but on techni­ cal and marketable skills, not just on basic health but on universalization of world class health care, with emphasis on life style diseases, geriatric care and the like. Kerala has a very high self imposed code of decent work and dignity of labour and work ethics are of a high order. Unfortunately, not enough publicity is given to the high skill and clean working practices of Kerala’s workforce. The perception that Kerala labour is militant continues to linger even though industry situated in Kerala is fully conscious of the fact that there has been a tectonic change in attitudes over the years. Kerala is considered a model state for Governance, in general, and Local Self Government, in particular. Against the backdrop of these achievements, what is required now is momentum in employment generating and environment friendly growth. Despite banks being flush with funds, there do not appear to be adequate investment avenues to tap. Both land and labour are severely constrained. Farm viability is low and there are major trans­ port and energy infrastructural constraints. The rapid pace of urbanization in Kerala has brought with it major challenges including provision of adequate and affordable houses, public transport services, solid waste management and supply of uninter­ rupted power. Migration, both outward and inward, have separate and well defined challenges, which could adversely affect the State’s progress, if not appropriately tackled. Various social problems such as alcoholism, violence, increase in woman- headed households, deterioration in mental health, life-style diseases and so on are emerging as threats to progress. Several new initiatives taken by the Central Government in the 12th Plan would be of advantage to Kerala. The greater flexibility given to Centrally Sponsored Schemes will give us an opportunity to design schemes to better suit our own needs. Various new infrastructure projects are in the pipeline - Kochi Metro, Thiruvananthapuram and Kozhikode Monorail projects, Vizhinjam Port, Kochi-Palakkad National Invest­ ment Manufacturing Zone, Palakkad Rail Coach Factory, High Speed Rail Corridor, to name a few. Close monitoring of these projects to ensure timely take-off will ease the pressure on our strained physical infrastructure. Every effort should be made to tap non-budgetary sources on investment so that budgetary funds are more effec­ tively used. Better targeting of subsidies and pruning of unproductive expenditure will provide fiscal space for channelling borrowed funds into productive capital as­ sets. The quick introduction of destination based Goods and Service Tax is also likely to help a net importing state like Kerala. The Review brings out various measures taken by Government to combat these threats and provides the reader with an objective account of the state of the econo­ my. The web version of this Review is available on www.spb.kerala.gov.in. We wel­ come your suggestions for further improvement of the Review. CONTENTS Kerala at a glance ix List of tables xi List of boxes XV List of figures xvii Chapter 1 MACRO ECONOMIC PROFILE 1-31 Demography 3 Income 5 Poverty 11 Urbanisation in Kerala 14 Prices 15 State Finances 18 Banking 28 Chapter 2 AGRICULTURE AND ALLIED SECTORS 35-84 Agriculture 36 Crop Insurance 48 Live Stock Development 53 Fisheries Development 61 Water Resources 66 Forestry and Wild Life 70 Environment 74 Co-Operation & Agricultural Finance 76 Agricultural Finance 77 Rural Development Programmes 79 Food Security 81 Chapter 3 INDUSTRY, LABOUR AND EMPLOYMENT 87-127 Industry 88 State Level Public Sector Enterprises (SPSE) 89 Micro Small and Medium Enterprises (MSME) 93 Food Processing Industries (FPI) 98 Handloom Sector 100 Textile Sector 103 Power loom 103 Handicrafts 104 Coir Industry 106 Khadhi and Village Industries 108 Cashew Industry 109 Minerals 111 Labour and Labour Welfare 112 Health Insurance Scheme 116 Unemployment Situation in Kerala 119 Employment in the Organised Sector 120 Employment in the Unorganised Sector 122 Performance of KSESDM 126 Chapter 4 SOCIAL SERVICE 131-199 Education 131 Higher Secondary Education 137 Vocational Higher Secondary Education 138 University and Higher Education 138 Technical Education 141 Art & Culture 145 Medical and Public Health 146 Major Health Problems in Kerala 150 Medical Education 159 Indian System of Medicine 160 Homoeopathy 162 Social Security and Welfare 165 Drinking Water 175 Gender Development 182 Welfare of SCs/STs, OBCs and Minorities 187 Development Programmes for SC &ST 188 SCP and TSP through Local Governments 189 Welfare of Other Backward Classes 197 Welfare of Minorities 199 Chapter 5 INFRASTRUCTURE 203-245 Transport 204 Transport Policy for Kerala - 2011 204 Road Transport Sector in Kerala 205 Trend of Road Accidents in Kerala 209 Railways in Kerala 211 Water Transport Sector 212 Energy 218 Power Sector in Kerala 218 Generation 219 Transmission 223 Distribution 224 Non-Conventional Sources of Energy 225 Urban Infrastructure 228 Communication Infrastructure 231 Information Technology 234 • • Sports Infrastucture................................................................ 237 Housing 240 Information & Publicity 243 Chapter 6 EXTERNAL SECTOR 249-262 Trade 250 Welfare of Non-Resident Keralites (NRKs) 255 Tourism 256 Chapter 7 CAPACITY BUILDING 265-275 Scientific Services & Research 266 Kerala State Council for Science, Technology and Envmt 267 Skill Development 272 Chapter 8 LOCAL GOVERNMENT AND DECENTRALISED PLANNING 280-294 Trajectory of Decentralised Planning in Kerala 280 Achievements and Challenges 293 Glossary 295 Abbreviations 299 ,/:■-' *sV ■• : ■ ■ ' . -■! .■ , . 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