Friday, August 31, 2007

Karnataka - infrastructure bottlenecks

Gathering pace


Bangalore is now focussed on working out ways to remove its infrastructure bottlenecks.


A view of Bangalore’s Metro station and tracks.

BANGALORE, Karnataka’s capital city located 980 metres above sea level, is no longer the idyllic pensioner’s paradise that it was a few decades ago. It has led India’s advance into the information technology age, with the expression “to be Bangalored” (meaning “outsourced”) finding a place in the jargon used in connection with the United States economy.

But infrastructure in India’s fastest growing urban agglomeration, the country’s Silicon Valley, has not kept pace with the growth of its population, which is close to 7.5 million and is expected to reach 12.5 million by 2036. This has meant a fall in the quality of life. Traffic snarls, unheard of a couple of decades ago, are an everyday ordeal for road users. The problem is compounded by inefficient, badly planned and lackadaisical traffic policing and poor driving skills. Garbage disposal systems have repeatedly faced hiccups. The storm water drains are filled with debris and silt. The development of residential layouts has been haphazard and the public transport system is unable to wean away people from the use of private vehicle.

However, the main utility stakeholders are now trying to put in place measures that will enhance the quality of life.

Bangalore’s phenomenal growth of the last 15 years, driven by the rise of the information technology sector, has forced the State government to form a new administrative body for the city. Called the Bruhat Bangalore Mahanagar Palike, or Greater Bangalore Municipal Body (BBMP), it would extend the urban area of Bangalore currently administered by the Bangalore Mahanagara Palike (BMP) by integrating areas that were administered by seven city municipal councils, one town municipal council and 111 urbanised villages. While the BMP administered an area of 226 sq km, the BBMP’s jurisdiction will be 728 sq km.

The BBMP’s budget has also swelled with overall receipts for 2007-08 standing at Rs.3,302 crore, the estimated expenditure being Rs.3,312 crore. Tax revenue is expected to yield Rs.610 crore in 2007-08, against Rs.368 crore in 2006-07.

An artist’s impression of the completed Metro Rail project.

Acknowledging the gigantic task ahead, BBMP Commissioner Dr. S. Subramanya said that since the Palike was an important stakeholder in the Jawaharlal Nehru National Urban Renewal Mission (JNNURM), it was leveraging the Mission’s funds for infrastructure projects under the 2006-12 City Development Plan. “We have made a substantial allocation in the Budget, to the extent of Rs.1,060 crore under the JNNURM.”

According to Subramanya, the biggest stumbling blocks to providing an orderly administration, efficient infrastructure and proper delivery of public service were collusion between employees and a lack of transparency. “I admit that my system is a huge contributor for the rot. Transparency is the key. The collusion can be broken by transparency. Huge reforms are needed in urban administration.”

Citing traffic problems as a major reason for disruption of life in Bangalore, the Commissioner said that road intersection management was crucial. “We are widening 10 arterial roads at a cost of Rs.100 crore, building grade separators and road overbridges [for which Rs.130 crore has been sanctioned], planning an elevated, inner core road in central Bangalore, planning to convert a few arterial roads into six-laned roads and constructing elevated roads over storm water drains.”

The BBMP has undertaken a Rs.643-crore project to remodel 250 km of storm water drains to prevent flooding. It is also modernising markets, rejuvenating 17 tanks close to the city and building 5,000 houses for the urban poor, at a cost of Rs.200 crore.

Admitting that not much had been done for the urban poor, elderly people and women, Subramanya said that day care centres were being set up in a number of places, with ISKCON (International Society for Krishna Consciousness) supplying lunch for the needy. The government will pay ISKCON Rs.4.50 for every meal. “Our welfare systems are not known widely. Of the 56,000 babies born every year, a third are delivered at corporation-run hospitals. We are also setting up small BBMP clinics which will hand out non-prescription drugs, check blood pressure, and so on. They will remain open till 9 p.m..”

In a bid to enhance tax collection without changing the rates or bringing in new procedures, the BBMP has decided to establish high value assessment units which will assess buildings for tax. “There are 25 lakh properties in the BBMP limits, but we are going to look at just 2,000 of them. These will be assessed by a chartered accountant as per the relevant Act. A lawyer will verify and then serve the demand with the new rates. We will also file a caveat. Any high-asset building that has applied for an occupancy certificate will be visited by the team.”


A traffic jam on Seshadri Road. Traffic congestion is now recognised as one of the major problems of the city.

According to the Commissioner, the project has already produced results. “The owners of six buildings, who were paying a tax of Rs.1.07 crore, will now have to pay Rs.8 crore. Many buildings, including the corporate office of a public sector company, had not even been assessed. They have now been assessed for Rs.76 lakh. The Information Technology Park Limited has been paying a tax of around Rs1.06 crore; a correct assessment will yield Rs.10 crore. The Infosys Technologies building at Electronic City is also being assessed.”

The BBMP is setting up new units called the BBMP Contact Points to address problems in time and reduce red tape at the ward offices. Explains Subramanya: “Every group of 4,000 buildings will be monitored by a small BBMP office staffed by five functionaries, including the revenue officer. Our 17,000 employees will be employed for this. Any issue pertaining to those 4,000 buildings, including matters like issuing of khats, the roads in the area, will be under the jurisdiction of the respective contact point. The enforcement officer will go around his area and capture on video the day’s activities. This will ensure that we have a permanent repository of what happened where and when. The idea is to make ourselves visible, the BBMP presence must be there. We are also setting up a call centre that will have six lines and will be manned by a person 24x7, and complaints have to be attended within two hours.” A total of 368 such centres will be set up.

The BBMP is also planning to introduce the “shaming” concept: the idea is to make public details of every building. Coloured stickers indicating the property’s details, the amount of tax paid, whether it is residential, commercial, or rented, will be handed out along with the tax receipts. These stickers are to be pasted on the building. Every year, the colours will change.


With over 2.5 million vehicles on the already clogged roads and a further 900 being added everyday, Bangalore has been crying out for a modern Mass Rapid Transit System (MRTS) that not only integrates the existing transport systems but also offers incentives for people to stop using private vehicles. According to V. Madhu, Managing Director, Bangalore Metro Rail Corporation Limited (BMTCL), the Special Purpose Vehicle formed on a 50:50 basis by the Central and State governments to implement the metro rail project in Bangalore, the city should have got an MRTS “at least 15 years ago”.

In 1983, the Metropolitan Transit Project, an organisation of the Indian Railways, prepared a feasibility report for a 57.9-km circular suburban rail service on existing lines. In 1988, a World Bank-aided study carried out by the Rail India Technical and Economic Services (RITES) recommended a commuter rail system along with improvement of the road transport system. In 1994, a study commissioned by the Bangalore Mass Rapid Transit Limited suggested a public-private partnership model and even selected a partner. None of these projects took off.

In 2003, the Delhi Metro Rail Corporation, with help from the RITES, submitted a report, which concluded that Bangalore, with its projected Peak Hour Peak Direction Trips (PHPDT) of around 40,000 by 2021, required a metro rail system. Under Phase I, it proposed two electrified corridors: an 18.90-km long East-West line and a 14.10 km North-South line. While the East-West corridor would start from Byappanahalli and terminate at the Mysore Road terminal, the North-South line would begin at Yeshwantpur and terminate at R.V. Road.

Weaving through some of the busiest commercial and residential areas, an almost 8-km stretch of Bangalore Metro will be underground in the stretch from Bangalore City Railway Station to City Market, through Majestic and Vidhana Soudha. Designed for a carrying capacity of 40,000 during peak hours, Bangalore Metro is expected to carry around 10.20 lakh passengers in 2011 and 16.10 lakh by 2021. Initially the train will consist of three self-closing, stainless steel, air-conditioned coaches, each 2.88 m wide, which can accommodate 1,000 people. It will later be augmented to six coaches with a carrying capacity of 2,068 passengers. Fares are expected to be between Rs.7 and Rs.15.

The total outlay for the project is envisaged at Rs.6,395 crore, with funding coming by way of equity (Rs.1,918.50 crore) and subordinate debt (Rs.1,598.75 crores) from both the State and Central governments – and senior term debt (Rs.2,877.75 crore). While 17 per cent of senior term debt will come from a consortium of Indian banks led by UTI Bank, the remaining 28 per cent is from the Japan Bank for International Cooperation.

Land acquisition procedures are under way. Several writ petitions, however, have been filed against the land acquisition and adverse verdicts may disrupt the project. Under the present plan, 138 acres will be acquired from the Centre and 32.22 acres from the State government. In addition, 27 acres will be acquired from private owners at a cost of Rs.566 crore. Cost and time overruns are two things that have been worrying Madhu: “It is a mammoth task. The underground tunnelling itself is estimated to cost Rs.1,300 crore. And international companies are busy around the world since so many metro projects are being constructed.” With a commissioning deadline on December 31, 2011 (the East-West line will run earlier, in March 2010), the BMRCL has listed over 6,500 tasks that must be completed before that.

The BMRCL has appointed a consortium consisting of Pacific Consultants (Japan), PB Consultants (USA), Systra (France) and RITES as general consultants at a cost of Rs.212 crore. Over the next six years, the consortium will offer 9,000 man months of design and management advice and supervise the project. The global tender that went out for rolling stock (wagons) has attracted big players such as Fireman Transport, Siemens, Bombardier, Norico, Mitsubishi, Alsthom, Rotem and BEML. Initial rolling stock could cost around Rs.750 crore.

Transport Corporation

The Bangalore Metropolitan Transport Corporation (BMTC) has been an independent body for just 10 years now; it was part of the Karnataka State Road Transport Corporation. The BMTC, earlier known as the Bangalore Transport Service, has been around since 1961.

The BMTC has structured its functions under a two-tier system – depots and the corporate office. Managing Director Upendra Tripathy says this has been done “to have closer liaison and better control and to reduce intermediary posts without compromising on efficiency”. The number of buses, the routes covered, frequency and comfort levels have all been increased exponentially.

While the number of kilometres covered in a day has gone up from 4.43 lakh in 1997 to 9.48 lakh now, the BMTC’s fleet strength has gone up from 2,098 to 4,606 during the same period. Its services are now available across an area of 479 sq km.

The BMTC hopes to have a fleet of 6,000 buses by 2009-10, which would be just right for Bangalore, according to an Indian Institute of Management report. Between 1997-98 and 2006-07, the BMTC’s net worth climbed from the red (minus Rs.11 crore) to Rs.683 crore, and an accumulated loss of Rs.80 crore has been turned into a profit of Rs.460 crore.

Tripathy says the corporation’s aim is to “attract commuters, subsidise fares through non-traffic income and offer world class service at competitive fares”. The BMTC plans to spend Rs.1 crore to explain to commuters why they should opt for public transport. It is creating infrastructure to meet the growing needs over the next 30 years. It is, for instance, setting up 45 Traffic Transit Management Centres, which will be “sprawling supermarkets”. Explains Tripathy: “At these centres, people can come and shop, pay utility bills, buy bus tickets, and even park their vehicles.”


A passenfer using the electronic pass-and-ticket vending system at a BMTC platform.

With traffic congestions causing losses running into crores of rupees, the BMTC hopes to have its entire fleet tracked on line, allowing depot mangers to synergise operations; 1,200 buses are already being tracked on line.

Tripathy also said that the BMTC had hired 2,000 employees who would work in split shifts, fours hours in the morning and again four hours during peak hours in the evening. In order to fund acquisition of vehicles, including 1,000 Volvo buses and 500 Suvarna Karnataka Service buses, build more bus shelters (the city needs over 2,000), and execute other expansion plans, the BMTC may become the first State Transport Corporation in India to take the initial public offering (IPO) route. The shares, with a face value of Rs.10, will be issued at a premium that is yet to be decided.

The BMTC’s board has approved the IPO proposal and the corporation hopes to raise around Rs.4,000 crore through the shares. The proposal has now been placed before the State government. The corporation’s 22,000 employees will be offered an employee stock ownership plan subject to a maximum of 200 shares, which will be given at par. The IPO could be out by early 2008. Says Tripathy: “Only by providing ultra modern buses and quality service can we attract commuters who are otherwise using two wheelers and cars. And to maintain a professional service you need funds.”


Supplying water and taking care of the sanitation needs of a growing city can be a daunting task; more so when the city is 90 km away from the closest river source and the water has to be pumped up to an elevation of a hundred feet, and when most of the natural and artificial lakes and tanks that traditionally fed the city have either been polluted or encroached upon.

At present, the Bangalore Water Supply and Sewerage Board (BWSSB), constituted in October 1964, supplies 840 MLD (millions of litres per day) of water, chiefly from the Cauvery and the Arkavathy, translating into a supply of 100 to 110 litres per capita per day. Covering a core area of 226 sq km with an adjacent area of 75 sq km, the Board has 5.5 lakh water supply connections.

With areas to be supplied increasing, ground water becoming scarce and the supply already lagging behind demand, the deficit is expected to touch 1,050 MLD by 2036; that is, the Board will be able to provide 1,500 MLD of water against a demand of 2,550 MLD. The BWSSB’s new initiative is to treat waste water and re-use it for potable purposes. With the available water sources, there appears to be no alternative to looking to unconventional methods of water supply, including recycling.

BWSSB Chairperson G. Latha Krishna Rao said: “Recycled water is already being used for non-potable purposes by industries. Recycling water for potable purposes will have to be a major initiative in our plans if we are to satisfy Bangalore’s drinking water requirements. Wastewater, after being treated through the ultra filtration process (which uses the cellulose membrane technology), will be taken via a separate pipeline and then made to blend with the reservoir water. This water will then be taken through the regular filtration process before it is pumped into the system.”

According to Latha Krishna Rao, the Board is thinking of installing two ultra filtration plants: one with a capacity of 200 MLD at the Vrushabavathi Valley at a cost of Rs.860 crore and another with a capacity of 400 MLD at a cost of Rs.1,300 crore in the KC Valley. The project could take three years to implement. Latha Krishna Rao said: “In the case of the KC Valley, ultra filtration plant, 400 MLD of the 675 MLD of wastewater that is generated will be taken to the plant, treated and then made to blend with water at the Hesaraghatta reservoir. At the moment we are not able to pump water from reservoirs like Hesaraghatta since the levels are too low. By pumping in treated water, I can increase the level and pump out water. The water from the reservoir will be filtered through the regular process and treated and pumped to Bangalore. I can get around 200 to 250 MLD of good water.”

Among the projects that the BWSSB has in the pipeline are the Rs.3,443-crore, 500-MLD water supply scheme for Bangalore, funded by the Japan Bank for International Cooperation, under the Cauvery Water Supply Scheme-Phase II, which is scheduled to be completed by 2011-12; the JNNURM- and World Bank-assisted Karnataka Municipal Reforms Project (completion by 2011) to supply water to eight urban bodies and provide water and sanitation to 110 urbanised villages that have been recently added to Bangalore city (Rs.1,400 crore); and the Rs.700 crore proposal for the rehabilitation of water supply distribution systems in the core area of Bangalore.

The BWSSB currently operates 12 wastewater treatment plants with an installed capacity of 718 MLD. The Board expects a generation of 1570 MLD of sewage by 2036. During 2006-07, against a revenue demand of Rs.414.87 crore, the revenue collected was Rs.398.52 crore, resulting in accumulated arrears of Rs.236.05 crore. The BWSSB continues to lose revenue on account of public taps and unaccounted water (Rs.66.98 crore) for which they have requested the government for a full subsidy to cover unauthorised connections. In an attempt to “find out where and how the service-oriented, ‘no loss, no profit’ organisation truly stands vis-a-vis the other establishments”, the BWSSB has asked ICRA Limited, one of India̵ 7;s leading credit rating consultants, to assess the Board. The rating, which should be out by November, will, according to Latha Krishna Rao, not only help the BWSSB to see where it stands but will also enable it to secure funding from the public and financial institutions.

With Karnataka rapidly urbanising and nearly a third of its population living in urban areas, the Karnataka government deemed it fit to set up a public limited company to assess the infrastructure needs of urban areas, prepare, formulate and implement projects, act as the nodal agency to implement government programmes and raise financial resources.

In November 1993, this idea fructified with the forming of the Karnataka Urban Infrastructure Development and Finance Corporation Limited (KUIDFCL). Since then, the company has been functioning as the main arm of the State government with regard to urban infrastructure development projects and as the government’s interface with external lending agencies.

It also implements schemes and programmes relating to infrastructure development in urban areas, particularly land development, sanitation, road management, transportation and provides technical and other assistance to urban bodies for development schemes, including implementation of master plans. The KUIDFCL also provides consultancy services and extends financial assistance by way of loans and advances to corporations, municipalities, urban development authorities. The company has already completed the Asian Development Bank(ADB)-assisted Karnataka Urban Infrastructure Development Project. It is implementing the ADB-assisted Karnataka Urban Development and Coastal Environmental Management Project, the North Karnataka Urban Sector Investment Programme, the World Bank-assisted Karnataka Urban Water Sector Improvement Project, the Karnataka Municipal Reforms Project and the JNNURM-sponsored Bangalore Mega City Scheme.


The BWSSB sewage treatment plant at Yelahanka New Town.

It is also involved in the preparation of City Level Investment Plans for the remaining 146 urban local bodies in the State that are not covered under externally aided projects.

The KUIDFCL hopes to emerge as a full-fledged State-level financial institution performing two key functions: project development and financing. It has been nominated by the Government of India as the State-level nodal agency for pooled finance development facility. It has an Empowered Committee for the management of externally aided projects. The Committee, which has been constituted for efficient, effective and speedy decision-making has been given full authority with regard to project implementation activities, including approval of works and contracts, appointment of consultants, and so on. It acts as a single window system for all the clearances/approvals required from various government departments.

To manage funds provided under the JNNURM, the KUIDFCL has set up a State-level Steering Committee, which identifies projects, prioritise identified projects and monitors the progress of these projects. Also, to facilitate speedy decisions and approvals of projects and with a view to achieving coordination between various implementing agencies and government departments, another empowered committee has been constituted for JNNURM.

Bangalore Development Agency

Buying a plot of land in Bangalore has been a nightmare for decades. Either the cost or the legal hassles could put land out of people’s reach. One had to venture into the far-flung suburbs to buy a revenue site, which may not have any civic amenities and could also land you in the courts if the papers are not clear. The Bangalore Development Authority (BDA) has been trying to find a solution to the problem.

Though it was set up three decades ago, the BDA had largely been dormant for many years. Its inefficient legal team was unable to extricate it from lengthy legal hassles that it got embroiled in while acquiring land. Things changed in the late 1990s. The organisation’s motto is to “transform Bangalore into an ideal global destination with high quality infrastructure, better quality of life by ensuring sustainable and planned development based on effective monitoring, regulation, through participatory and innovative approach”. It seeks to plan, regulate, control, monitor and facilitate urban development in Bangalore.

According to BDA Commissioner M.K. Shankaralinge Gowda, plans are afoot to form six new layouts in the north, east and west of Bangalore: “The layouts will allow the BDA to distribute around 50,000 sites. And most importantly, these layouts are as per the master plan (Comprehensive Development Plan) for Bangalore. The idea is to disperse the population, and also the investment that is coming to the City."


Related stories in Frontline, which are reproduced in this Blog as follows:

Karnataka - an Overview

BESCOM - Power drive

Bangalore as India's IT Capital

Karnataka - an Overview

Soaring economy

in Bangalore

The State has come a long way from the agrarian economy that it inherited in 1956.

The Bangalore Palace.

KARNATAKA, India’s eighth largest State in terms of geographical size (191,791 sq km) encompasses and mirrors everything that is the Indian subcontinent: diverse regions, cultures, languages and faiths; economic boom and agrarian crises; and a marked regional disparity in levels of human development. In terms of development, too, Karnataka is a typical Indian State, reflecting, generally, where the country as a whole stands.

With 53 million people, Karnataka accounts for 5.13 per cent of India’s population, the ninth largest among the States. While its sex ratio (965) stands above the all-India average of 933, the ratio for children under six declined from 960 in 1991 to 946 in 2001. Around 66 per cent of the State’s population lives in rural areas. The State has 1,67,378 km of well-knit motorable road, a 3,172-km rail network, important airports at Bangalore, Belgaum, Mangalore and Hubli, an all-weather cargo vessel handling seaport at Mangalore, and what will eventually become the biggest naval base this side of the Suez, the INS Kadamba at Karwar.

Karnataka is one of the most progressive and industrialised States in India and its capital Bangalore is also the country’s information technology (IT) and biotechnology capital. Rich in resources such as gold, iron ore, manganese, chromites, bauxite, china clay, granite, limestone and copper, Karnataka is also a tourist’s delight: the narrow coastal belt between the Western Ghats and the Arabian Sea, dominated by coconut groves and paddy fields; the Western Ghats or Malnad whose forests abound in coffee, pepper, rubber and cardamom plantations; and plateaus.

Karnataka is among the most industrialised States and healthy labour relations have made it a favourite investment destination.

The southern plateau and its rolling hills are washed by the Cauvery, which originates in Kodagu, and its tributaries – the Hemavathy and the Harangi. The less developed north is marked by the rich black cotton soil of the Deccan plateau. With meagre rainfall, the northern plateau’s agriculture (chiefly jowar, cotton, oilseeds, sugar cane and pulses) is sustained by the Krishna and its tributaries – the Malaprabha, the Ghataprabha, the Tungabhadra and the Bheema.

Karnataka, earlier known as Mysore, came into being on November 1, 1956, with the merger of five territories where Kannada was the main language; it has 27 revenue districts and 175 taluks. The State was carved out of four districts of the erstwhile Bombay State; three districts of the erstwhile princely state of Hyderabad; two districts and one taluk of the former Madras Presidency; the former Part C state of Coorg (now called Kodagu) and nine districts of the former princely state of Mysore. As a consequence of the amalgamation of regions of varying levels of socio-economic development and different political and administrative structures, the modern State inherited regional imbalances that still persist. Access to services in Karnataka largely depends on where one lives.

Unlike Mysore, the princely state of Hyderabad did not see much investment in human capital or in developing the region. As a result, the Hyderabad-Karnataka areas of the State are still worse off. A High Power Committee for the Redressal of Regional Imbalances (HPCFRRI) constituted in 2000 has identified 26 of the region’s 28 taluks as being most or more backward; the other two have been classified as backward. Comprising Bidar, Gulbarga, Raichur and Bellary districts, this region has also been frequently devastated by droughts and famines. The Gazetteer of India gave vivid accounts of scarcity and famine conditions in the region from the 17th century onwards.

The Bombay-Karnataka region comprising Bijapur, Dharwad, Belgaum and Uttara Kannada districts, which were part of the erstwhile Bombay Presidency, and Bagalkot, Gadag and Haveri districts, which were added to it later, has a relatively better socio-economic climate: the HPCFRRI named 17 of its 31 taluks as most or more backward.

South Karnataka consists of 15 districts, most of which were part of the erstwhile princely state of Mysore and are still referred to as “Old Mysore”. Contrary to popular perception, this region is neither homogeneous nor uniformly prosperous. It is broadly classified into the coastal (Dakshina Kannada and Udupi), Malnad (Kodagu, Chikmaglur, Shimoga and Hassan) and plateau (Mysore, Mandya, Kolar, Tumkur, Chamarajnagar, Davangere, Chitradurga, Bangalore Rural and Bangalore Urban districts) areas. Whereas the Malnad and coastal areas have fared fairly well, the unirrigated plateau areas of the south, with the exception of the two Bangalore districts, remain relatively backward.

In terms of the extent of arid land, Karnataka is second only to Rajasthan.

The pressure on housing is immense in Bangalore, which has led to a building boom in recent years.

Before Independence, the princely state of Mysore was reputed to be one of the most progressive regions of the country. A modern system of education was introduced here as early as 1833, with the opening of English schools in Bangalore, Tumkur, Hassan and Shimoga almost at the same time. The first school for girls was set up by the London Mission in Bangalore in 1840 when education for girls was still a novelty. The government girls school was started in 1881 with help from the Maharaja of Mysore. Mysore University was set up in 1916.

The importance given to education was reflected in literacy figures during the pre-Independence years: it was 20.3 per cent against the 16.6 per cent elsewhere in India. Basic health care was also one of the priorities of the governments of old Mysore and in 1806 it was arguably the first state in the country to take up vaccination against small pox. It 1930, Mysore became the first in the world to establish birth control clinics. A government hospital was set up in Bangalore in 1846 and the first public unit was opened in Mandya in 1929.

Ruled by benevolent maharajas and far-sighted dewans like C .Rangacharalu, K. Seshadri Iyer, Sir M. Visvesvaraya and Sir Mirza Ismail, Mysore established its Representative Assembly in 1887 when even the Presidencies did not have su ch bodies. In 1902, a hydroelectric power station was commissioned at Sivasamudram, another first in the country. Bangalore became the first Indian city to get electrification in 1905.

Bangalore’s salubrious climate and geographic location in the hinterland prompted Prime Minister Jawaharlal Nehru to locate major public sector enterprises such as the Indian Telephone Industries, Hindustan Machine Tools, Bharat Electronics, Bharat Earth Movers Limited and Hindustan Aeronautics Limited in the garden city. The location of a number of technical institutions, the Indian Institute of Science and research organisations has also been a boon for the State’s industrial sector, providing a continuous pool of talent.

For the State, the presence of these industries acted like a catalyst, creating industrial infrastructure and employment opportunities and leading to the setting up of hundreds of ancillary units and support facilities. According to the Karnataka Human Development Report (KHDR), 2005, which was brought out by the State government in 2006, the State witnessed the highest economic growth rate in terms of both Gross State Domestic Product (GSDP) and per capita GSDP during 1990-2001. Karnataka’s income or Net State Domestic Product (at 1993-94 prices) increased from Rs.30,087.57 crore in 1990-91 to Rs.61,386.40 crore in 2001-02, registering an increase of 9.5 per cent per annum. During the same period, the per capita income increased from Rs.6,739 to Rs.11,516, an increase of 7.1 per cent.

Economic progress

The character of the State’s economy has changed over the years. In 1956, it was predominantly agrarian in character, but that changed significantly since 1980-81. According to the KHDR, the primary sector, which contributed about 60 per cent of the State’s GDP in 1960-61 (at 1980-81 prices) contributed only about 43 per cent in 1981; the figure subsequently declined to 26 per cent in 2001-02 (at 1993-94 prices). During the corresponding period, the share of secondary sector increased from 15.2 per cent to 23 per cent, and then to 26 per cent. The share of its tertiary sector from 24.8 per cent to 34 per cent and then, in 2001-02, to 48 per cent. Diversification is, of course, a characteristic of a modern economy. However, it is a matter of concern that the size of the State’s workforce dependent on the primary sector is not commensurate with the sector’s share in the GDP.

Karnataka’s GDP grew by 8.7 per cent during 2005-06. Though agriculture continues to be the mainstay of the people, Karnataka, which has been a pioneer in industrial development, now stands sixth among the States in terms of output. Thanks to cordial labour relations, proactive government policies and a rich talent pool, the State has become a favoured destination for domestic and overseas industrialists and entrepreneurs who have set up manufacturing facilities in automobiles, machine tools, electronic components, pharmaceuticals and garments across the State. According to the Economic Census 1998, there were 19.12 lakh enterprises in the State engaged in economic activities other than crop production. While the number of persons usually working in these enterprises was 52.53 lakh, Karnataka accounted for 8 per cent of the all-India enterprises, and 8.15 per cent of the total “usually working” employment. Also, while the State accounts for around 20 per cent of India’s turnover in the electronics and communication equipment sector, the automobile segment generates about Rs.2,000 crore.

But Karnataka’s biggest success story in recent years has been the growth of knowledge-based industries – information technology (IT) and biotechnology. The State accounts for approximately 37 per cent of India’s IT and IT-enabled Services (worth Rs.50,000 crore). Around 40 per cent the country’s biotech firms are located in Karnataka.

Fifty-six per cent of Karnataka’s workforce still derives its living from the land, either as cultivators or as agricultural labourers. But with agriculture highly dependent on rain (only 25 per cent of net area sown is irrigated), farm output is at the mercy of the South-West Monsoon. In recent years, Karnataka has been hit by severe droughts and flash floods.

With development has come speed, necessitating the building of roads. The State has 1,67,378 km of motorable road.

Karnataka’s agriculture is marked by crop diversification. A slew of measures, including more funds for irrigation and hastening of construction works, has pushed up the extent of Karnataka’s net irrigated area from 7.6 lakh hectares in 1957-58 to 26.4 lakh ha in 2000-01. While the State has estimated the irrigation potential from all sources at 55 lakh ha, the potential created until 2003-04 was 30.61 lakh ha.

The State has taken steady steps in the direction of universal literacy: the literacy rate increased from 56.04 per cent in 1991 to 66.64 per cent in 2001, with the female literacy rate moving faster than the male rate. Though Karnataka’s literacy rates have been consistently higher than the all-India average, it is still to catch up with neighbouring States like Kerala (90.9), Tamil Nadu (73.5) and Maharashtra (76.9).

Although better than the all-India averages, Karnataka still has a long way to go before it can claim to have provided health for all. Life expectancy at birth has increased to 65.8 years in 2001, the decadal population growth rate has declined to 17.5 per cent. Mortality rates at infant (52 per 1000 live births), neonatal (37.1 per 1000), child (19.3 per 1000) and maternal (195 per lakh) stages have shown a downward trend.

Karnataka is also likely to achieve the Tenth Plan objective of reducing maternal mortality rates to 2 per 1000 births by the end of 2007. It ranks third among the States in its health expenditure, the per capita expenditure being Rs.238.38. There is one doctor for every 3,240 people.

Going by the methodology advocated by the United Nations Development Programme, which measures the core dimensions of human development – health, education and income – Karnataka’s Human Development Index is much higher than the all-India average. Among the States it ranks seventh, while at the international level it stands at 120 (India is at 127). The State’s attainment of human development is on a par with that of Egypt.



Related stories in Frontline, which are reproduced in this Blog as follows:

Infrastructure Bottlenecks

BESCOM - Power drive

Bangalore as India's IT Capital

Ottavio Quattrocchi walks free

Off the hook


Ottavio Quattrocchi walks free after the Indian government decides not to appeal against an Argentine court’s rejection of its plea to extradite him.

THE entry on physical description for Ottavio Quattrocchi, wanted by Interpol, New Delhi, for his role in fraud and bribery in the Bofors pay-off case, on the website of the Central Bureau of Investigation (CBI) reads:

Height: not known

Colour of eyes: not known

Colour of hair: not known

Distinguishing marks: not known

Characteristics: not known

That the CBI could not provide a physical description of the well-known accused – very often shown on television – may well suggest its lack of seriousness in seeking his extradition despite the fact that it did not prevent the Argentinian authorities from detaining him on February 6 on the basis of an Interpol red corner notice issued in 1997. But the story of how Quattrocchi succeeded in leaving Argentina for Milan, Italy, on August 15 after getting back his travel documents reveals the investigating agency’s connivance at derailing the extradition proceedings against him.

Quattrocchi got bail in February itself, but was barred from leaving Argentina until the extradition proceedings finally concluded. On June 8, Judge Mario Harichi Doi of the First Court in El Dorado, Argentina, rejected, on technical grounds, the Indian government’s request for extraditing Quattrocchi to India. The Judge’s objection, according to reports, was that the fresh arrest warrant issued by a Delhi court on February 24 did not spell out the “reasons” why Quattrocchi ought to be arrested.

Quattrocchi’s detention on February 6 was carried out on the basis of the arrest warrant without bail issued by the Special Judge, Delhi, on May 25, 1997. So the Indian government, Judge Mario Hachiro Doi said, should have attached a certified copy of that judicial decision which ordered the detention but instead, only the arrest warrant of February 24 had been tagged. Even this warrant the Judge said, did not specify the “reasons” for detention and for the request of extradition. This was a “fundamental requirement” for not dismissing the request for extradition, the Judge said.

Under Argentine law, the lower court’s decision would be challenged automatically before the Supreme Court by the public prosecutor unless the government specifically asked him not to.

Only on July 28 the CBI filed a status report in the court of the Chief Metropolitan Magistrate (CMM) in Delhi – which is the court where the Bofors case is being heard and Quattrocchi is listed as an absconding accused – that an appeal had been filed. The CBI’s status report stated: “It is further informed that an appeal against the order dated June 8, 2007 of the Federal Court [rejecting the CBI’s extradition request] as is mandatory as per Argentine law, has been filed by the Argentine public prosecutor in the Federal Court of El Dorado.”

According to reports, Lilian Delgado, the Argentine public prosecutor hired by the government in March to press for Quattrocchi’s extradition, confirmed on August 15 that the Indian government had decided to withdraw the appeal. Indian Ambassador Pramathesh Rath handed over a “formal communication” to the Argentinian Foreign Office asking to withdraw the Supreme Court appeal. CBI Director Vijay Shankar was apparently unaware of the appeal being filed and withdrawn.

Precisely who in the Indian government advised Lilian Delgado to withdraw the appeal and on what grounds it was done remains a mystery.

The Supreme Court, while hearing a petition filed by Ajay K. Agrawal on August 20, directed the CBI to place before it the order of the Argentinian Judge rejecting the extradition request. Agrawal’s petition followed the CBI’s failure to file an appeal against two verdicts of the Delhi High Court in the Bofors case. Agrawal had also challenged the Indian government’s role in defreezing Quattrocchi’s bank accounts in London, enabling him to withdraw the entire money deposited in the accounts.

The CBI’s status report did not refer to the specific grounds cited by the Argentinian Judge for rejecting the extradition request. According to the report, the request was declined because Quattrocchi’s detention was illegal as it was not supported by a reasoned order of the Indian court and because the non-bailable warrant issued by the CMM, Delhi, on February 24, though supported by an order, was not adequate.

Agrawal’s application has raised disturbing issues concerning the CBI’s handling of the case. Citing newspaper reports, he alleged that CBI officials passed on “opinions” of Law Officers and of its own officials to Quattrocchi’s counsel to “facilitate” its “own defeat” in court. “[The] CBI was neither serious nor sincere in its efforts to secure his extradition,” Agrawal alleged.

An important newspaper report the CBI has so far not rebutted is the one quoting Quattrocchi’s counsel, Free Land. The Sunday Express of June 10 quoted him as saying that among the papers he presented to the Judge was the opin ion of S.K. Sharma, CBI’s Director of Prosecution – who was, ironically, present in the El Dorado courtroom – that the entire Bofors investigation had become untenable and that “there was no case”. Free Land continued: “It was this opinion in 2005 that led to the CBI not filing an appeal against the Delhi High Court ruling by Justice R.S. Sodhi dismissing the case against [the] Hindujas.”

Doubts have also arisen whether the CBI rebutted effectively the arguments of Quattrocchi’s counsel against extradition. One of the pleas of his counsel was that the warrant produced by the CBI was silent on the two Delhi High Court judgments in the Bofors case. On February 4, 2004, Justice J.D. Kapoor dismissed the charges against the various accused in the Bofors pay-offs case. He held that Quattrocchi could be charged only with conspiracy to cheat. In May 2005, Justice R.S. Sodhi gave a clean chit to the Hinduja brothers..

On February 24, 2007, the CBI obtained a fresh non-bailable warrant of arrest against Quattrocchi under Section 120-B read with Section 420 of the Indian Penal Code (dealing with conspiracy and cheating respectively) from the court of the CMM, Delhi, as the previous non-bailable arrest warrant, dated February 6, 1997, had been issued by the Court of Special Judge, Delhi, under various provisions of law, including the Prevention of Corruption Act (PCA).

In his February 2004 order, Justice Kapoor quashed the charges under the PCA, making it necessary, it would seem, for the CBI to obtain a fresh warrant. But the question why the CBI did not obtain a fresh warrant immediately after the February 4, 2004, order remains unanswered. The fresh warrant was obtained after Quattrocchi was detained in Argentina on the basis of the old warrant whose legal validity had come under a cloud following Justice Kapoor’s order. If the cheating and conspiracy charges survived under the old warrant, there was no need to obtain a fresh warrant after Quattrocchi’s detention in Argentina.

The red corner notice was issued against Quattrocchi on February 17, 1997, although he had left India in 1993 under mysterious circumstances. His trial was separated from that of the other accused in 2001.

Case in Malaysia

In 2003, the CBI attempted to seek Quattrocchi’s extradition from Malaysia. The Indian government contested the matter before Malaysian courts. The Sessions Court in Malaysia held that under both Malaysian law and Indian law conspiracy and cheating were two separate offences, but when read together they gave rise to duplicity of offences, resulting in ambiguity.

As a consequence, the Sessions Court concluded there was no clear indication of the description of the offence that was committed. Therefore, it was not possible for the court to determine whether the offence was an extradition offence under Section 6 of the Malaysian Extradition statute.

The High Court of Malaysia held that the identification of the corruption offence alleged to have been committed by Quattrocchi was open to doubt. The thrust of the cheating offence against Quattrocchi was the receipt of money by him following the appointment of A.E. Services Limited of the United Kingdom, at his behest, as the consultants of Bofors.

The High Court of Malaysia pointed out that paragraph 13 of the charge sheet of the Indian trial court referred to the prohibition on the appointment of agents as “the present government did not approve of the appointment of Indian agent[s] acting for foreign suppliers”.

The court then noted: “When I invited the prosecution and the two counsel to submit on them there was no positive response worthy of consideration. These facts cannot therefore be termed or treated as particulars for the offence of cheating from the document made available.” Thus, the High Court affirmed the order of discharge passed by the Sessions Court and dismissed the Indian government’s application for extradition. Both the Court of Appeal and the Federal Court of Malaysia dismissed the Indian government’s appeals.

In 2006, the CBI defended before the Supreme Court its decision to defreeze Quattrocchi’s accounts in London by claiming that there was no evidence to link the funds in the London accounts with the proceeds received by Quattrocchi allegedly through A.E. Services. Secondly, the CBI claimed there was imminent unlikelihood of securing his presence in India for completing the trial.

After the failure of the extradition case in Argentina, Vijay Shankar said the CBI would continue to pursue his extradition and the red corner notice against him would survive as long as he was wanted by an Indian court. Going by the experience so far, it could be an exercise in futility.


Sepoy Mutiny at Vellore: Dinamani

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Sepoy Mutiny at Vellore

Thursday August 30 2007 00:00 IST

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Karunanidhi suffers setback in son Azhagiri's case

Karunanidhi suffers setback in son Azhagiri's case

Written by
R. Bhagwan Singh

Political rivals of the Tamil Nadu chief minister M. Karunanidhi will applaud in glee the order of the Supreme Court on 27 August transferring the 'Kiruttinan murder case', in which his son M. K. Azhagiri is the main accused, from the Sessions Court at Madurai to Chittoor in Andhra Pradesh, with the directive that the Sessions Judge, Chittoor, should conduct the trial 'as expeditiously as possible'. The Court has ordered the transfer of this sensational case relating to the May 2003 murder of Kiruttinan, who was a minister in an earlier Karunanidhi Cabinet, after two prosecution witnesses petitioned alleging they were threatened not to depose against the accused in the trial. They had also expressed apprehension that the trial would not be fair as Azhagiri wielded enormous clout in the administration in Tamil Nadu, particularly in the southern districts.

The Apex Court in passing the order has observed that the case was being transferred only to ensure that people would have confidence in the trial---which in effect meant that the Division Bench of Justice S. Ashok Bhan and Justice V. S. Sirpurkar, was convinced that the trial would not be fair at Madurai, the headquarters of the DMK's southern satrap Azhagiri. "The shifting of the case is not because you (Azhagiri) are the son of the chief minister. You are an acknowledged leader of that area. It only disturbs us. The Presiding Officer of the (trial) court had also expressed apprehension," the Court has said, packing a thousand thoughts in just those few lines.

The prosecution in the Kiruttinan case had alleged that Azhagiri had ordered the murder as he did not like any challenge to his clout in the southern districts. Even though the Apex Court has said it was not transferring the case because the accused was the son of the chief minister, it was clear that it did take note of the cloud wielded by Azhagiri in the administration of Tamil Nadu. This aspect was also highlighted in the present petition drawing attention to the May nine attack on the Dinakaran newspaper in Madurai allegedly by Azhagiri supporters angered by an opinion poll it printed giving him a low rating. Three employees of the Tamil daily were killed in that arson.

Even as the opposition parties and the media organisations came down heavily upon the DMK government for letting him run riot, Azhagiri was openly pampered with prime attention at the gala function celebrating the chief minister's 50 years in the legislature, which was organised at Chennai soon after the Dinakaran attack. Prime Minister Manmohan Singh and UPA chairperson Sonia Gandhi were among the high dignitaries present on the dais alongside Karunanidhi at that time.

And in the bye-election for the Madurai West Assembly seat held in June, Azhagiri worked harder than even the candidate of the Congress ally, because he needed to prove that the attack on Dinakaran did not dent his 'popularity' on home turf. His loyalists later held a grand celebration in Madurai to felicitate Azhagiri for the Congress victory in that bye-election, where one of them even recalled how papa Karunanidhi rose to his feet—an honour reserved only for party general secretary K.Anbazhagan---when the son arrived at the DMK headquarters at Chennai flushed with the poll victory. Replying to all that boundless praise, Azhagiri recalled that his father had warmly complimented him for the huge fame he had won in that bye-election. He did not need any other reward or party post after that papa's pat, he had gushed then, to stress how the recent events had brought him closer to the DMK chief.

Interestingly, when the CBI entrusted with the Dinakaran case filed its charge sheet in the Madurai Bench of the Madras High Court on August 6, the premier Central investigating agency had included the deputy superintendent of police V. Rajaram as number 17 in the list of seventeen accused, alleging he was a mute spectator at the newspaper office when the goons torched the building with the three innocent workers inside. When the DSP contested this and wanted the Court to quash the case, the CBI came up with its counter on August 28 claiming it had videotapes to prove that Rajaram was indeed a silent spectator to the arson.

True, video evidence could be good enough to punish the officer but then, what does the CBI expect the poor fellow to do? Challenge the ravaging thugs? Was it not common knowledge that some of the members of that attack-team, figuring in the CBI charge sheet, have long been close to Azhagiri? These posers do not mean that the pampered son of the chief minister must surely be responsible for that murderous attack, which could have been the work of a surcharged mob even without his go-ahead signal. True, one could thus give him the benefit of doubt. In fact, many in the media circles had then said it was quite possible that Azhagiri might have merely expressed anger and told his 'mob' to teach Dinakaran a lesson and the 'boys' acted in over-enthusiasm!

Back to the Supreme Court order; it must be noted that transferring such controversial cases as the Kiruttinan murder, from one state to another might help in getting fair trial but did not automatically ensure their speedy disposal. For instance, former AIADMK chief minister Ms Jayalalithaa's wealth case was transferred from Chennai to Bangalore but it is still dragging on trapped in a host of legal complexities. Almost similar is the plight of the Sankararaman murder case transferred from Chengalpattu Sessions Court to the Puducherry court—the Kanchi Sankaracharyas are among the accused in this case.

The Supreme Court would do well to monitor the progress of such sensitive cases to ensure their speedy disposal. While a pickpocket pulled out of a crowded bus gets his three-month jail term double-quick and remains forever on the police records as a piece of garbage for resurrection whenever a face is required before a magistrate trying even a different case, the rich and powerful are almost getting away with murder, literally. And if a chain-snatcher in Bhagalpur of Bihar can be beaten to pulp by the public and then dragged by the motorcycle of a policeman in an ugly interpretation of our enlightened independence, a wealthy and politically powerful person accused of serious crimes can fly in with his battery of smart lawyers and walk away with a bail order.

India Interacts

Related Stories

SC transfers Azhagiri case to Chittoor

Wednesday, August 29, 2007

O. Paneerselvam, new AIADMK treasurer

O.Paneerselvam, new AIADMK treasurer

Special Correspondent

Major reshuffle in party; T.T.V.Dinakaran removed from the list of office-bearers

Jayakumar new MGR Mandram secretary

Thambidurai is propaganda secretary

CHENNAI: The All India Anna Dravida Munnetra Kazhagam general secretary Jayalalithaa on Monday effected a major reshuffle in the party, removing Rajya Sabha Member of Parliament T.T.V.Dinakaran from the list of office-bearers.

Former Chief Minister and party Election Wing secretary O. Paneerselvam replaces Mr. Dinakaran, a nephew of Ms.Jayalalithaa’s friend Sasikala, as the party’s treasurer.

Former Minister and Fishermen wing secretary D. Jayakumar will be the party’s new MGR Mandram secretary. He replaces D. Madhusoodhanan, the chairman of the party presidium, who was holding additional charge. Mr. Madhusoodhanan will continue as the presidium chairman.

Organising secretary M.Thambidurai will be the new propaganda secretary, replacing Edapadi K. Palanichamy, who has now been made one of the organising secretaries.

P.H. Pandian, the minorities welfare wing president, will also be an organising secretary.

Former Minister Pollachi V. Jayaraman has been nominated as the party’s new election wing secretary while former MLA N.R.Sivapathi will be party’s MGR youth wing secretary.

Former Minister K.K.Kalaimani will take Mr. Jayakumar’s place as the fishermen’s wing secretary, while A.Justin Selvaraj will be the new minorities wing president.

© Copyright 2000 - 2006 The Hindu


Tuesday, August 28, 2007

Russia, US may sign nuclear deal

Russia, US may sign nuclear deal

28 Aug, 2007, 1953 hrs IST, IANS

MOSCOW: A senior Russian nuclear official said on Tuesday that a deal is likely to be signed with the United States this fall on the civilian use of nuclear power.

The document, initiated two months ago, envisages the transfer of fissile materials and relevant installations and equipment. "We hope the document will be signed during the coming fall," said Nikolai Spassky, deputy head of the Federal Agency for Nuclear Power.

He said the agency aimed to increase the share of nuclear energy in Russia's power generation to 21-25 percent from the current 16.5 by 2020. Russia plans to put 10 new nuclear power units into operation by 2015.

Agency chief Sergei Kiriyenko said last September that Russia was planning to build 42-58 nuclear reactors for its own needs by 2030, and 40-50 units abroad in the next 30 years.

Russia currently has 10 operational nuclear power plants with 31 reactors, but Kiriyenko said the country would need another 300 gigawatts from new plants to cover a projected energy deficit in the next three decades.

"We will have to commission new energy-generating facilities capable of producing 300 GW by 2030," he said at the time, adding that from 2015 the industry would commission at least two power-generating units annually without governmental subsidies.

Russia's reserves of coal and natural gas could be depleted in fifty years. With around 8 per cent of the world's uranium output, Russia plans to mine 60-70 per cent of its uranium needs domestically by 2015, with the remainder coming from joint ventures in the republics of the erstwhile Soviet Union, particularly Kazakhstan, which holds 25-30 per cent of the world's uranium reserves.

The Economic Times
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