Government to Enhance State and Central Relationship

If the Vajpayee government tried to bring progress through roads, the Modi government should try rails for the same objective. This is an important directive that the Economic Survey gives to the government.

The survey, which compared development of railways in India and China, said that China had overtaken India by a significant margin with respect to expansion of railways years before.

In the past decade, the Railways was neglected in India and investment was not sufficient, according to the survey. In 1990, China, which was behind India with respect to its rail network, overtook India in 1995 and made significant progress thence. While India has about 64,000 kilometres of rail network, China, has about 90,000 kilometres to its credit. China invested 11 times more on its railways than what India invested for expanding its rail network.

The survey also showed that rail networks are more productive than roads in terms of efficiency and costs. While rail networks are 75 per cent to 90 per cent more fuel efficient, they earn more for the nation than road transport. Each rupee that is invested in the Railways would return to the nation, in three years, with Rs 5 as profit.

When the Make-In-India campaign is given due importance, the service sector should not be ignored. While lack of adequate manpower is the main drag on the service sector, it could be attributed to lack of proper education and slow spread of literacy. If Make-In-India is to become a success, a 'Skill India' programme should also be made successful.

The allocation of more resources -- an increase of 10 per cent in allocation of central tax to states -- would enhance relations between the state and the central government. The move would also promote financial federalism. States would earn about Rs two lakh crore additionally in the next financial year. The formation of Neeti Ayog would also help in this direction.