A substantial part of this increase is expected to be achieved through an improvement in the yield per acre. It is expected, for example, that the average yield of rice during the Third Plan period will be 1030 lb per acre as compared to 80 lb in the Second Plan period.
17. With the achievement of these targets, the economy will become self-sufficient in the supply of foodgrains and per capita availability will go up from 16 oz per day in 1960-61 to 17.5 oz per day in 1965-66. The per capita consumption of cloth per annum will go up from 15.5 yards in 1960-61 to 17.2 yards in 1965-66: Production of subsidiary foods like fruits and vegetables, for which there is a growing demand in the country, will be given special emphasis and an attempt will be made to provide a more balanced diet than at present. Special measures will be taken to step up the production of commodi- ties like tea, coffee, rubber, coconut, arecanut, tobacco, pepper, cardamom and lac, which are important for either earning or saving foreign exchange.
18, Large programmes for the improvement of animal husbandry, dairying, fisheries and forestry have also been included in the third Plan. Of the key village blocks already established under the pro- gramme for intensive development of cattle, 55 will be expanded and 38 new blocks will be set up in important breeding tracts. The number of veterinary hospitals and dispensaries will be raised from 4000 to 8000 and the programme for eradication of rinderpest already initiated will be completed. The production of wool will be stepped up from 72 million lb to 90 million lb. The production of milk will be increased from 22 million tons to 25 million tons. New milk supply schemes will be taken up in 55 cities with a population exceeding one lakh each, 8 rural creameries, 4 milk product factories and 2 cheese factories will be set up. The production of fish will be stepped up from 1.4 million tons to 1.8 million tons; 4000 fishing boats will be mechanised and 35 large vessels will be added to the country's fishing fleet. Special emphasis will be given to the development of forestry-700,000 acres afforested with economic species, 600,000 acres of degraded forests rehabilitated and 1,200,000 acres developed as village forests. A countrywide pre-investment survey will be initiated with a view to assessing the potential for the development of large-scale timber and pulp-based industries.
INDUSTRIES 19. Of basic importance in the Third Plan is the programme for the expansion of industries, especially capital and producer goods industries with special emphasis on machine-building and development of managerial skill, technical knowhow and designing capacity. In this programme the public sector has been assigned a key role, but the private sector is also expected to have an important part to play within the framework of the plan. The share of the public sector in the net output of organised manufacturing industries is expected to increase from less than one-tenth in 1960-61 to about one-fourth in 1965-66, and the bulk of this will comprise capital and producer goods. For the development of industries and minerals, the Plan in- cludes a programme costing Rs. 1882 crores but makes for the present a financial provision of Rs. 1520 crores in the public sector. In addition, the private sector is expected to provide about Rs. 1050 crores. The private sector is also expected to provide about Rs. 150 crores to meet the arrears of replacement and modernisation in certain pre-war industries.
20. The emphasis throughout the Third Plan is on the develop- ment of those industries which will help to make the economy selfsus- taining, such as steel, machine-building and the manufacture of pro- ducer goods, and reduce, as rapidly as possible the need for external assistance to purchase these goods and also permit a broadening of the export base. The production of consumer goods will also be expanded substantially, mainly in the private sector. it is expected that as a result of all these developments, industrial production will rise by nearly 70 per cent, but even more significant than this increase will be the development in the fields of iron and steel, machinery and chemicals, some idea of which may be obtained from the following Table:
* In terms of raw or gur @ Exclusive mesta which may provide 1.3 million bales in 1965-66
THE THIRD PLAN IN OUTLINE 35
Table 6 : Index number of industrial production* (1950-51=100)
percentage increase in
group 1960-61 1965-66 1965-66 over 1960-61
general index 194 329 70
cotton textiles 133 157 18
iron and steel 238 637 168
machinery (all types) 503 1224 143
chemicals 288 720 150
As has been mentioned earlier this index does not include a large number of new industries and is being revised.
21. The major industrial projects in the public sector included in the Third Plan are in the fields of metallurgy, industrial machin- ery, machine tools, fertilisers, basic chemicals and intermediates, essential drugs and petroleum. refining. Overall capacity targets proposed under the iron and steel industry comprise 10.2 million tons of steel ingots and 1.5 million tons of pig iron. These will 'be achieved by expanding the public sector steel plants at Rourkela, Bhilai and Durgapur to a target capacity of 5.9 million tons and also by setting up a fourth steel plant at Bokaro. There will be some expansion of capacity for steel in the private sector mainly through the installation of scrap-based electric furnaces which will augment the supplies of billets to re-rollers. About 200,000 tons of pig iron is also expected to be produced from low shaft furnaces proposed to be established on a decentralised basis in the private sector, The manu- facture of tool, alloy and stainless steels has been given a high priority in the Third Plan and it is expected that a total production of 200,000 tons will be achieved by 1965-66. In the field of non- ferrous metals, the Plan aims at achieving a production target of 80,000 tons of aluminium and setting up the first zinc smelting plant in the country with a capacity of 15,000 tons. The production of copper is expected to increase from 8900 tons to 20,000 tons.
22. The most significant development during the Third Plan period will, however, be the rapid growth of machine-building and engineering industries. Foundry/forge capacity, which is crucial for machine-building purposes, will be established on a large scale in the public sector during the Third Plan. The heavy machinery plant being set up near Ranchi, on its expansion to a capacity of 80,000 tons of output per year, will be able to supply a large part of the equipment required for setting up a million-ton steelmaking capacity every year. Three heavy electrical equipment projects are designed to ensure, from- domestic resources, a wide range of electrical equipment suffi- cient to enable power generation to be increased at an annual rate of two million kW per year from 1971 onwards. In the field of machine tools, provision has been made for the expansion of the existing machine tool plants and the establishment of two new plants in the public sector. Substantial expansion in the production of machine tools in the private sector is also expected, and the target for machine tools production has been put at Rs. 30 crores. The target for the automobile industry has been placed at 30,000 passenger cars and 60,000 commercial vehicles.
23. Production of inorganic fertilisers in terms of nitrogen will be stepped up from about 110,000 tons to 800,000 tons. A sub- stantial increase in the production of phosphatic fertilisers is also proposed. A production target of 1.5 million tons has been set for sulphuric acid and of 340,000 tons for caustic soda. Provision has also been made for increasing the production of organic chemicals, plastics, dyestuffs and drugs. The target of production for cement has been fixed at 13 million tons and that of capacity for refining crude oil at about 11 million tons. Other important projects included in the Third Plan are the synthetic drugs project at Sanatnagar, antibiotics plant near Rishikesh and phytochemical project in Kerala. In the sphere of consumer goods industries, it is proposed to expand substantially the production capacity for cloth, paper, sugar, edible oils, watches, etc.
24. A short list of the important industrial targets included in the Third Plan is given below:
Table 7: Selected targets of industrial production
item unit 1960-61 1965-66
steel ingots million tons 3.5 9.2
aluminimum 000 tons 18.5 80
diesel engine 000 numbers 40 66
tractors 000 numbers 2 10
electric cables (ACSR
conductors) 000 tons 22 44
nitrogenous fertilizers 000 tons of N 110 800
phosphatic fertilisers 000 tons of P2O5 55 400
sulphuric acid 000 tons 363 1500
caustic soda 000 tons 100 340
cement million tons 8.5 13
petroleum products million tons 5.7 9.9
machine tools (graded) value in Rs. lakhs 550 3000
ball and roller bearings million numbers 2.9 14
cotton textiles (millmade) million yards 5127 5800
sugar@ million tons 3.0 3.5
paper and paper board 000 tons 350 700
bicycles(organised
sector only) 000 numbers 1050 2000
sewing machines
(organised sector only) 000 numbers 297 700
automobiles 000 numbers 53.5 100
* This index is the same as the official index except that the comparison base has been changed from the calendar year 1951 to the financial year 1950-51 so as to facilitate measure- ment of growth over the plan periods
@ Relates to crop year, November-October.
36 THIRD FIVE YEAR PLAN
MINERALS 25. The greater emphasis laid on the expansion of industry during the Third Plan calls for an intensified programme of mineral development. Some minerals have also a good export market and are important foreign exchange earners. Having regard to the pro- grammes for power, railways, steel, cement and other industries which are important consumers of coal, the target for coal for the Third Plan has been fixed at 97 million tons. This target will require production capacity to be stepped up by 37 million tons over the target of 60 million tons set for the last year of the Second Plan. Of the additional production of 37 million tons, 20 million tons will come from the public sector and 17 million tons from the private sector. The amount of iron ore necessary to meet proposed steel and pig iron targets is estimated at about 20 million tons. The iron ore required for export will amount to 10 million tons. To meet this requirement, a capacity target of 32 million tons has been fixed for iron ore in the Third Plan. Provision has also been made for explora- tion and exploitation of new copper deposits for an annual production of 11,500 tons of electrolytic copper, exploitation of pyrites depos- its in Bihar, development of diamond deposits in Madhya Pradesh, extraction and processing of uranium and intensive exploitation of manganese, bauxite, gypsum and limestone deposits.
26. A high priority has been given to exploration and exploita- tion of the mineral oil resources in the country. The Oil and Natural Gas Commission will operate on a larger scale with a view to proving new reserves and establishing additional production. The programme of exploration will cover most of the promising sedimentary areas in the country. In addition, foreign firms have been invited by Government to join the search for oil subject to mutually acceptable terms. Oil India, a joint venture of the Assam Oil Company and the Government of India, is expected to achieve an annual production of 2.75 million tons of crude oil. Government will be entering upon petroleum refin- ing as a producer for the first time in 1962. With the completion of the Nunmati and Barauni refineries and the projected refinery in Gujarat, the share of the Government in the domestic refining capacity will be 47 per cent of the total.
VILLAGE AND SMALL INDUSTRIES 27. Along, with large industries, village and small industries will be developed to provide employment and to increase production of consumer goods and some producer goods. Considerable progress has been already achieved in small scale industries, which combine the advantages of modern technology and the use of power with those of increased employment and greater opportunity for small entrepreneurs as well as for cooperatives. In the Third Plan they are expected to make still more rapid progress and to extend in larger measure to small towns and rural areas. A total provision of Rs. 264 crores is being made in the public sector for the programmes for village and small industries, as against about Rs. 175 crores spent in the Second Plan period. Additional funds will be available from other programmes community development, rehabilitation of displaced persons, social welfare and welfare of backward classes. Investment in the private sector is estimated at about Rs. 275 crores. It is also proposed to offer Government guarantees for bank loans to small industrialists. Three hundred new industrial estates will be set up as against about 120 sanctioned during the Second Plan period. 'Rural industrial estates' will be set up in selected rural areas, where power, water supply and other essential facilities are available or can be readily provided. The Khadi and Village Industries Commission will, give special attention to secure integrated rural development of selected compact areas or grain ekais, 3000 of which will be started during the Third Plan period. The production of cloth by the handloom, powerloom and khadi industries is expected to increase from about 2350 million yards in 1960-61 to 3500 million yards in 1965-66 and of raw silk from 3-6 million lb to 5 million lb. Programmes for coir and handicrafts will be consolidated and enlarged.
POWER 28. Power being the basis for the development of industries, both large and small, a high priority has been given to production of power in the Third Plan. The programmes for power development both for public and private sectors total Rs. 1089 crores. By the end of the Third Plan, generating capacity, including plants already commis- sioned and those under erection and testing, is expected to be of the order of 13.4 million kW, of which 12.7 million kW is expected to be in commercial operation as against 5.7 million kW at the end of the Second Plan. It is estimated that 45,000 million kWh of power will be generated during 1965-66 as against 19,850 million kWh during 1960-61. Transmission lines will be extended from 84,000 circuit miles in 1960- 61 to 150,000 circuit miles in 1965-66. The number of towns and villages electrified will be increased from 23,000 in 1960-61 to 43,000 by 1965-66. It is expected that practically all towns and villages with population exceeding 5000 and half of those with-popula- tion between 2000 and 5000 will receive the benefits of electricity. A nuclear power station of 0.3 million kW capacity will be set up to provide 0.15 million kW during the Third Plan period and the balance in the first year of the Fourth Plan. But bulk of the installed gener- ating capacity aggregating to 7.4 million kW will be provided by the thermal plants and 5.1 million kW by hydro plants.
TRANSPORT AND COMMUNICATIONS 29. The experience of the past few years has underlined the key role of transport and commu-
THE THIRD PLAN IN OUTLINE 37
nications in economic development. The programmes under this head total Rs. 1655 crores while the financial provision is Rs. 1486 crores for the present. Although large investments were made in this sector under the previous two Plans, the Third Plan includes a substantial programme for its further development. The railway development pro- gramme has been formulated on the basis of an estimated increase of freight traffic from 154 million tons in 1960-61 to 245 million tons in 1965-66. Nearly 90 per cent of this additional traffic is expected to be on account of iron and steel, ores, coal, cement and railway materials. Provision has been made for, among others, the construc- tion of 1200 miles of new lines, doubling of 1600 miles of single tracks and manufacturing of diesel and electric locomotives and cer- tain other items, which are still being imported. The road programmes provide for the addition of about 25,000 miles of surfaced roads and also for improvement of the existing road systems, such as providing bridges and missing links and upgrading the existing roads. The road transport programme will be largely in the private sector. The number of commercial vehicles on road is expected to increase from 2.10 lakhs in 1960-61 to 3.65 lakhs in 1965-66. The freight traffic by road is expected to increase by 120 per cent over the next five years. The Plan also includes programmes for development of major and minor ports and for expansion of shipping, inland water transport, civil air transport, posts and telegraphs and broadcasting services. An idea of the important targets in the field of transport and communications included in the Third Plan may be obtained from the following Table :
Table 8 : Transport and communications
item unit 1960-61 1965-66
railways :
new lines miles 800* 1200*
new double lines miles 1300* 1600*
freight carried million tons 154 245
roads and road transport
surfaced roads including
national highways 000 miles 144 169
vehicles on road
commercial 000 numbers 210 365
passenger 000 numbers 50 80
goods 000 numbers 160 285
shipping :
tonnage lakh GRT 9.0 10.9
ports:
major ports--capacity million tons 37 49
communications :
post offices 000 numbers 77 94
telegraph offices 000 numbers 6.5 8.5
telephone connections 000 numbers 460 660