Parliament voted on the Demands for Grants for the Ministry of Home Affairs on May 02, 2012. During the debate, MPs expressed concern over the status of police forces in different States of the country. They emphasised the need to augment the capability of police forces. Though ‘Police’ and ‘Public Order’ are State subjects, the union government provides assistance to States for strengthening their forces. For instance, the Ministry of Home Affairs has been implementing a non-plan scheme for ‘Modernization of Police Forces’ since 1969-70. Under the scheme assistance is provided in the form of grants-in-aid towards construction of secure police stations, outposts, for purchase of vehicles, equipment etc. (To know more about the scheme, see an earlier blog post on the issue.) At the all India level, the sanctioned strength of State Police equals 20.6 lakh personnel. Though there exist wide variations across States, at an average this amounts to 174 police personnel per lakh population. However, the actual ratio is much lower because of high vacancies in the police forces. At the aggregate level, 24% positions are vacant. The table below provides data on the strength of state police forces as in Jan, 2011
State | Sanctioned strength | Sanctioned policemen/ lakh of population | Vacancy |
Andhra Pradesh | 1,31,099 | 155 | 31% |
Arunachal Pradesh | 11,955 | 966 | 42% |
Assam | 62,149 | 200 | 12% |
Bihar | 85,939 | 88 | 27% |
Chhattisgarh | 50,869 | 207 | 18% |
Goa | 6,108 | 348 | 16% |
Gujarat | 87,877 | 151 | 27% |
Haryana | 61,307 | 248 | 28% |
Himachal Pradesh | 17,187 | 256 | 22% |
Jammu & Kashmir | 77,464 | 575 | 6% |
Jharkhand | 73,005 | 235 | 30% |
Karnataka | 91,256 | 155 | 10% |
Kerala | 49,394 | 141 | 7% |
Madhya Pradesh | 83,524 | 115 | 9% |
Maharashtra | 1,53,148 | 139 | 10% |
Manipur | 31,081 | 1,147 | 26% |
Meghalaya | 12,268 | 469 | 17% |
Mizoram | 11,246 | 1,112 | 6% |
Nagaland | 24,226 | 1,073 | 0% |
Orissa | 53,291 | 130 | 18% |
Punjab | 79,565 | 291 | 14% |
Rajasthan | 79,554 | 118 | 11% |
Sikkim | 5,421 | 886 | 27% |
Tamil Nadu | 1,20,441 | 178 | 15% |
Tripura | 44,310 | 1,224 | 17% |
Uttar Pradesh | 3,68,260 | 184 | 59% |
Uttarakhand | 20,775 | 211 | 24% |
West Bengal | 72,998 | 81 | 18% |
A&N Islands | 4,417 | 1,018 | 22% |
Chandigarh | 7,873 | 695 | 22% |
D&N Haveli | 325 | 114 | 13% |
Daman & Diu | 281 | 140 | 6% |
Delhi | 81,467 | 441 | 1% |
Lakshadweep | 349 | 478 | 36% |
Puducherry | 3,941 | 352 | 25% |
All India | 20,64,370 | 174 | 24% |
Source: Lok Sabha Unstarred Question No. 90, 13th March, 2012 and Lok Sabha Unstarred Question No. 1042, March 20, 2012
On September 14, 2012, the central government announced that foreign airlines would now be allowed to invest up to 49% in domestic airlines. Under the policy announced by the government, the ceiling of 49% foreign investment includes foreign direct investment and foreign institutional investment. Prior to investing in a domestic airline, foreign airlines would have to take approval of the Foreign Investment Promotion Board. Additionally, the applicant will also be required to seek security clearance from the Home Ministry. In 2000, the government first permitted foreign direct investment up to 40% in the domestic airline sector. However, no foreign airline was allowed to invest either directly or indirectly in the domestic airlines industry. Non Resident Indians were permitted to invest up to 100%. Furthermore, the foreign investor was required to take prior approval of the government before making the investment. Subsequently, the central government eased the foreign investment norms in this sector. As of April 2012, foreign direct investment is permitted in all civil aviation sectors. The Civil Aviation sector in India includes airports, scheduled and non-scheduled domestic passenger airlines, helicopter services / seaplane services, ground handling Services, maintenance and repair organizations, flying training institutes, and technical training institutions. Foreign airlines were not permitted to invest either directly or indirectly in domestic passenger airlines. However, they are permitted to invest in cargo companies and helicopter companies. Investment by foreign airlines in the domestic airline industry has been a long standing demand of domestic airlines. According to the Report of the Working Group on Civil Aviation for formulation of twelfth five year plan (2012-17), India is currently the 9th largest civil aviation market in the world. Between 2008 and 2011, passenger traffic (domestic and international) and freight traffic increased by a compounded annual growth rate of 7% and 11% respectively. The traffic growth (passenger and freight) at 18% exceeded the growth rate seen in China (9.7%) and Brazil (7.5%), and was higher than the global growth rate of 3.8%. According to the Centre for Civil Aviation, until February 2012, India had the second highest domestic air traffic growth. However, due to the crisis faced by Air India and Kingfisher, the passenger numbers have declined in June-July 2012. India was the only major domestic market that failed to show an expansion in demand in June 2012, as compared to the previous year. Despite the rapid growth, the financial performance of airlines in India has been poor. According to the Report of the Working Group on Civil Aviation, the industry is expected to have a debt burden of approximately USD 20 billion in 2011-2012. According to the same report, during the period 2007-2010 India's airlines suffered an accumulated loss of Rs 26,000 crores. According to the government, investment by foreign airlines shall bring in the much needed funds and expertise required by the domestic industry. However, as per to some analysts, foreign investment alone cannot solve the problem. According to them, the major cost impacting the growth of the industry is the high cost of Aviation Turbine Fuel. As per the press release by the government on June 6, 2012, ATF accounts for 40% of the operating cost of Indian carriers. In comparison, fuel constitutes only 20% of the cost for international carriers. ATF in India is priced, on an average, 60% higher than international prices. This is due to the high rate of taxation imposed on ATF by some states. In most states, the VAT on ATF is around 25-30%.