Annual plan to reduce the ill effects of Recession
REPORT ON Date: 20-01-2009

Kerala’s annual plan 2009-10 has been fixed by the State Planning Board at the level of Rs. 8650 crore, which is 12.34 percent higher than the 2008-09 figure of 7700 crore. Taking stock of the annual plan on January 17, 2009 Chief Minister revealed that the plan size might go up a little if the one time additional assistance for the plan from the Centre exceeded the assured level of Rs. 100 crore. This would be clear after his meeting with the Planning Commission.

The formulation of the annual plan 2009-10, of the State reveals a hard effort at social engineering in the face of recession caused by the vagaries of the globalised market economy. The plan seeks to give relief to the poorer sections of society affected by the crisis and to enable them to stand on their feet and progress. The vice-chairman of the Planning Commission, Prabhat Patnaik pointed out that the thrust of the annual plan was on ameliorating the hardships that the economic crisis would bring to the common people – the workers, the peasants and the small producers. In other worked the State’s proposed annual plan while making appropriate provisions for several large projects in the State seeks to reduce the ill effects of recession from the State’s economy.

Prices of cash crops had fallen and could fall further and all traditional sectors would witness under – demand, reducing the common man’s income, the Finance Minister said on the occasion. In this situation the annual plan has provided substantial increase in outlays for traditional industries such as coir, handlooms and cashew. These outlays will finance a range of anti-crisis measures such as technology infusion, price support and the hunt for new markets. The plan also proposes the setting up of a relief fund of Rs. 20 crore to marginal farmers of distress crops such as coffee and spices and to set up a Debt Relief Commission to take care of the indebted fisher folk.

This unfolding phase of the world economic crisis required still higher plan outlay. The crisis itself is the reason why this is difficult. The growth in the State’s revenue may decelerate. The restrictions imposed by the Centre on the State’s borrowing limit pose another big limitation, Chief Minister elaborated.

Even the proposed level of plan size represented the LDF Government’s determination to bring back to life the planning process, which had fallen into a coma during the period of ‘fiscal conservatism’ under the UDF Government, he said.

The trend in the plan outlay since 2007-08 suggested that the State would surpass the Eleventh Five-year plan target outlay of Rs. 40,422 crore.

Outlay for the local bodies came to 2,085 crore (increase from 1877.51 crore) Local bodies would launch a massive housing programme called EMS Housing Scheme for the poor during the year with the support of banks. Houses built under the one lakh Housing Scheme in the early 1970’s too will be renovated. Housing activities are expected to generate a lot of employment opportunities. Higher outlays are fixed for health and education too in the annual plan.