|Annual Report 1999-2000|
Ninth Five Year Plan
1. The Ninth Five Year Plan (1997-2002) obtained the final approval of National Development Council (NDC) on 19th February 1999. The salient features of the Ninth Five Year Plan are a target annual average growth rate of 6.5 per cent for the economy as whole, and a growth rate of 3.9 per cent for agriculture sector, among others. The key strategies envisaged to realise this target rest on attaining a high investment rate of 28.2 per cent of GDP at market prices. The domestic saving rate, which determines the sustainable level of investment, is targeted at 26.1 per cent of the GDP, resulting in a current account deficit of 2.1 per cent for Ninth Five Year Plan. Care has been taken to ensure achievement of a sustainable growth path in terms of external indebtedness as well as fiscal stability. Accordingly, the target growth rates for import and export are estimated at 10.8 per cent and 11.8 per cent per annum respectively.
Objectives of the Ninth Plan
2. The Ninth Plan assumes an Incremental Capital-Output Ratio (ICOR) of 4.3, which implies an assumption of average domestic savings and investment rates of 26.1 per cent and 28.2 per cent of GDP, respectively. The Ninth Plan proposes an investment of Rs.2171 thousand crore during the period 1997-2002 at 1996-97 prices, most of which (92.6% amounting to Rs.2011 thousand crore) could be financed from domestic resources. Investment in the public sector would be Rs.726 thousand crore constituting about 33 per cent of the total investment as against the level of 34.3 per cent realised during the Eighth Plan period. The public sector outlay is proposed at Rs.8,59,200 crore, out of which the Central Plan outlay would be Rs.4,89,361 crore, which includes provision to implement the additional requirements of Special Action Plans. The details of the Plan Outlays by broad heads of development for the Centre/UTs for the Ninth Plan is given in Annexure 2.1. and 2.1 (a) . The Central Budgetary Support to the Plan is targeted at Rs.374,000 crore at 1996-97 prices.
3. The Ninth Plan Document was tabled in the Lok Sabha on 1st December, 1999 and in the Rajya Sabha on 9th December, 1999.
ANNUAL PLAN 1999-2000
Formulation of Annual Plans
4.. In the course of formulating the Annual Plan, the Planning Commission assesses previous year's Plan performance in various sectors and suggests a reorientation of policies and modifications of strategies consistent with the changing context and requirements so as to ensure achievement of the long-term objectives. The Annual Plan includes the Plan of the Centre and the State Governments.
5. Discussions are held in the Planning Commission, at the level of technical experts and the political level. The dimensions of the State Plans are designed, in consultation with individual State Chief Ministers. Simultaneously, discussions are also held with Central Ministries, to arrive at a public investment programme which is consistent with Plan priorities, known and anticipated constraints and available resources.
6. In the beginning of the third quarter of each financial year, the Planning Commission indicates to the State Governments and Central Ministries important objectives, issues and concerns that should be kept in view while formulating the Annual Plan for the ensuing year and to furnish their Plan proposals, including physical targets and the corresponding financial outlays, within the overall framework of their respective Five Year Plans. The State Governments are also expected to furnish their estimates of financial resources, including proposals for mobilising additional resources, for their Annual Plans. These resource estimates and the respective requirements of the State Governments for Central Assistance are discussed in-depth in a series of meetings scheduled generally during November-December. These Working Group Meetings are attended by the concerned senior Officers of the State Governments and the Planning Commission. Similarly, in-depth discussions are held with senior officials of the Central Ministries/Departments on their Annual Plan proposals, during December-January of each financial year.
7. The Plan outlays arrived at in the meetings between the Deputy Chairman and State Chief Ministers/Lt. Governors in respect of State Plans and in the meetings taken by Secretary, Planning Commission with the Secretaries of Central Ministries/ Departments, regarding the Central Plan forms the basis for budgetary provisions for the Plan for the ensuing year.
8. The exercise for Annual Plan, 1999-2000 was undertaken against the backdrop of significant shortfalls in Plan expenditure during the preceding two years (1997-98 and 1998-99) of the Ninth Plan and the need to pursue fiscal consolidation at both Centre and State level. Thus, the necessity of maintaining a reasonable level and the desired sectoral pattern of allocations in Annual Plan 1999-2000, had to be reconciled with the priorities of the Government as reflected in the Prime Ministers Special Action Plans (SAP), as also the commitment to contain fiscal deficit. The Gross Budgetary Support (GBS) for the Annual Plan 1999-2000 was fixed at Rs.77,000 crores (registering an increase of Rs.8,629 crores over the Revised Estimates for the previous year.) of which Rs.44,000 crores were allocated to the Annual Plan of Central Sector and of this, as much as Rs. 31,035 crores of Budgetary Support has been provided to 18 Ministries and Departments which are covered by the Special Action Plans. The remaining Rs.33,000 crores being the Central assistance to State and UT Plans.
9. The total Central Plan Outlay for the Annual Plan 1999-2000 is Rs.103521 crores, it exceeds the revised estimates of Rs.88481.75 crores for Annual Plan 1998-99 by 17 per cent. The details of the Plan Outlays by broad heads of development for the Centre and the States/UTs for Annual Plan 1998-99(RE) are given in Annexure 2.2 and 2.2 (b). The details of the Plan Outlays for the Annual Plan 1999-2000 by broad heads of development for Central Sector are given in Annexure 2.3 and 2.3(c).
10. The allocation of GBS for Annual Plan 1999-2000 was made on the basis of assessment of Plan programmes/schemes of each Ministry/Department and also keeping in view their expenditure performance as reflected in the Revised Estimates for 1998-99. Thus, from within the available resources of Centre Sector, priority was given to the SAP covering 18 Ministries/Departments. Accordingly, the outlay of the SAP Ministries/Departments has been increased by about 12 per cent. This includes an increase of nearly 16 per cent in the GBS. For the remaining Ministries/Departments, every effort has been made to provide an increase in their revised GBS for 1998-99. Thus, for the non-SAP category of Ministries/ Departments, outlay has been decreased by about 4 per cent and GBS has been increased by about 15 per cent.
11. In pursuing Prime Ministers Special Action Plan, a Task Force on Information and Technology Software Development was set up in May, 1998 under the chairmanship of Deputy Chairman, Planning Commission. Out of the allocation of Rs.300 crore for Information Technology Development in the Ninth Five Year Plan, Rs.50 crore have been provided in the year 1999-2000 for the promotion and development of IT. This amount would be available to the Central Ministries/Departments.
12. The Annual Plan discussions to finalise the plan size of different States and UTs during 1999-2000 were held during June/July, 1999. An outlay of Rs.88655.70 crore has been approved for all the States/UTs for the Annual Plan 1999-2000 . The outlay for 1999-2000 includes an amount of Rs.3700.00 crore and Rs.385.08 crores towards Additional Central Assistance for Basic Minimum Services and Slum Development respectively. The States/UTs have been given the option to allocate the amount provided for seven Basic Minimum Services in accordance with their priorities. A separate provision of Rs.450.00 crores has been made for the plan of North Eastern Council during the year 1999-2000.