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Sikkim Food security

Sikkim Food security

Food Security Index of India as well as Sikkm

In India, the dimension of food security is important despite attaining self-sufficiency in food production. Though there has been a considerable improvement in productivity and production of rice and wheat, we have not been able to eliminate chronic hunger and poverty. Understanding of the different dimensions of food security, therefore, is of critical importance.
The concept of food security in the Indian context has been increasingly refined during the last 50 years.
After World War II, food security meant building emergency grain reserves and ensuring the physical availability of food in the market.
After the onset of green revolution in the late 1960s, it became obvious that economic access to food is equally important to ensure food security at the household level.
During the 1980s, the principle of social access was emphasised, with special reference to marginalised communities and gender discrimination.
After the United Nations Conference on Environment and Development (UNCED) conference in Rio de Janeiro, there has been an increasing recognition of the role of environmental factors in food security.
The ecological foundations essential for sustained agricultural progress are increasingly under stress due to human activities.
One of the early initiatives in assessing the food security scenario in the country was the release of a series of Atlases by M.S. Swaminathan Research Foundation (MSSRF) that looked into the food security in rural and urban areas and also the Sustainability of Food Security atlas of India.
Ensuring food security is an overall objective of development programmes in most developing economies like India. Several problems, such as hunger, malnutrition, under-nutrition and poverty, Association between Food Insecurity and Poverty Poverty Low productivity Human Development Food insecurity, hunger & Malnutrition Poor physical & Cognitive development arise due to food insecurity.

Historical View on Food Security across India as well as Sikkim

India‟s Public Distribution System (PDS) is the largest distribution network of its kind in the world. PDS was introduced around World War II as a war-time rationing measure.
Before the 1960s, distribution through PDS was generally dependant on imports of food grains.
It was expanded in the 1960s as a response to the food shortages of the time; subsequently, the government set up the Agriculture Prices Commission and the Food Corporation of India to improve domestic procurement and storage of food grains for PDS.
By the 1970s, PDS had evolved into a universal scheme for the distribution of subsidised food.
In the 1990s, the scheme was revamped to improve access of food grains to people in hilly and inaccessible areas, and to target the poor.
Subsequently, in 1997, the government launched the Targeted Public Distribution System (TPDS), with a focus on the poor.
TPDS aims to provide subsidised food and fuel to the poor through a network of ration shops.
Food grains such as rice and wheat that are provided under TPDS are procured from farmers, allocated to states and delivered to the ration shop where the beneficiary buys his entitlement.
The centre and states share the responsibilities of identifying the poor, procuring grains and delivering food grains to beneficiaries.
In September 2013, Parliament enacted the National Food Security Act, 2013.
The Act relies largely on the existing TPDS to deliver food grains as legal entitlements to poor households.
This marks a shift by making the right to food a justiciable right. In order to understand the implications of this Act, the note maps the food supply chain from the farmer to the beneficiary, identifies challenges to implementation of TPDS, and discusses alternatives to reform TPDS.

Sikkim Food Security also based on National Food Security

The National Development Council (NDC) in its 53rd meeting held on 29th May, 2007 adopted a resolution to launch a Food Security Mission comprising rice, wheat and pulses to increase the production of rice by 10 million tons, wheat by 8 million tons and pulses by 2 million tons by the end of the Eleventh Plan (2011-12).
Accordingly, a Centrally Sponsored Scheme, ‘National Food Security Mission’ (NFSM), was launched in October 2007.
The Mission is being continued during 12th Five Year Plan with new targets of additional production of food grains of 25 million tons of food grains comprising of 10 million tons rice, 8 million tons of wheat, 4 million tons of pulses and 3 million tons of coarse cereals by the end of 12th Five Year Plan.
The National Food Security Mission (NFSM) during the 12th Five Year Plan will have five components

NFSM- Rice;
NFSM-Wheat;
NFSM-Pulses,
NFSM-Coarse cereals and
NFSM-Commercial Crops.

Area Coverage under NFSM from 2016-17 onwards:

From 2016-17, NFSM is implemented in 638 districts of 29 states.
NFSM-Rice is being implemented in 194 districts of 25 states.
NFSM-Wheat is being implemented in 126 districts of 11 states.
NFSM-Pulses is being implemented in 638 districts of 29 states
An NFSM-Coarse cereal is being implemented in 265 districts of 28 states.

Sikkim Food Security and Related Department work

Since independence, the Government of India has been implementing various schemes focusing on the poor for their upliftment. The government at the center as well as in the state has introduced various schemes whereby enabling the poor to at least two square meals in a day. Development would lose its meaning to a hungry man.
Mahatma Gandhi once said that “A STARVING MAN COULD ONLY UNDERSTAND GOD IN THE FORM OF BREAD”.

The Food & Civil Supplies & Consumer Affairs Department of Government of Sikkim

The Food & Civil Supplies & Consumer Affairs Department is entrusted with the task of implementing the Public Distribution System that envisages providing quality food grains, at subsidized rates and to ensure equitable distribution. The department has the dual duty of procuring and distributing food grains and petroleum products as well as monitoring and enforcing regulatory orders of the government.

Functions the Food & Civil Supplies & Consumer Affairs Department of Government of Sikkim

The main functions of Food & Civil Supplies & Consumer Affairs Department are:

Procurement of food-grains covered under Targeted Public Distribution System (TPDS) from Food Corporation of India as per allotment.
Transportation, storage and distribution of food-grains and other essential commodities in the state through a chain of Govt. Food Grain Godowns, Identified Fair Price Shops/Retail Shops, MPCS and Consumer Co-operative Societies (CCS).
Ensure regular availability of food grains and other essential food commodities.
Provide ration cards to the residents of the state.

ESSENTIAL COMMODITIES COVERED UNDER TPDS of SIKKIM

Rice and Sugar -Being made available directly to the consumers all over the state through Govt. Food Grains godowns /Fair Price Shops/MPCS.CSS and through Ration Cards
Wheat and Iodized Salt -APL category Whole Meal Atta and Iodized salt is being made available with the assistance of Nominees and Agents appointed by the State Govt. through Fair Price and other shops.
Blue Dyed Kerosene (SK Oil)Procured by Dealers appointed by Oil Companies , is made available for the consumption of general consumers by the Department through identified Fair Price and other authorized retail shops.

Sikkim Government Major Initiative for food Security and Welfare of People of Sikkim

Mukhya Mantri Antodaya Annadan Yojana of Sikkim Govt:

The poorest of the poor from the 43,428 BPL families earlier identified were further identified for the Antodaya Annadan Yojana Scheme.
The 9914 beneficiaries under this scheme are entitled to 35 kgs of rice @3 /- per kg per month.
The State Government however rechristened the name of the Scheme to Mukhya Mantri Antodaya AnnadanYojana from 23rd August 2003 and 9914 Families are provided 35 kgs of rice free of cost, 347 MTs of rice is distributed under this scheme to the beneficiary families.

Expanded Antodaya Annadan Yojana of Sikkim Govt:

The Government of India allocates 578 MTs of rice under the Antodaya Anna Yojana out of which 347 MTs of rice is distributed under the MMAAY scheme, and the remaining 231 MTs of rice is distributed to 6600 families under this scheme.
The beneficiaries are issued 35 kgs of rice @3/- per kg per month.

Annapurna Scheme of Sikkim Govt:

Under this scheme helpless aged people above the age of 65 years who have no one to support them and are eligible for National Old Age Pension but have not received them are provided with 10 kgs of rice free of cost.
The beneficiaries of this scheme have been provided rice from April 2000.
A total of 2500 beneficiaries are availing rice under this scheme.
A separate and distinct Ration Card has been provided to the beneficiaries free of cost

Whole Wheat of Sikkim Govt:

The Government of India allocates 245 MTs of whole wheat to the State.
For the convenience of the public it is ground into whole meal atta and distributed to ration card holders at the scale of 1 kg per individual @8.92 per kg per month through Fair Price Shops and other designated shops.
The State also received 1145 MT of wheat as special adhoc allotment during the year. This was sold at the rate of 12/- per kg/ per person.

Levy Sugar of Sikkim Govt:

The State of Sikkim is allotted 391 MTs of Levy Sugar per month.
Consequent upon the inability of supplying levy sugar by the Food Corporation of India from their depots in the State, the State lifts the allotted quota by engaging an agent directly from various Sugar Mills, of Uttar Pradesh.
The sugar is transported by road to Siliguri and further transported to different Food Godowns in the State.
The retail sale price of levy sugar has been fix at 25.40 per kg inclusive of transportation cost. Effort is being made by the Department to avail subsidy under “Price Equalization Fund” to enable the Government for distributing levy sugar at a lower price.

Kerosene Oil of Sikkim Govt:

Sikkim is allotted 546 KL of Kerosene Oil per month.
This is issued through Fair Price Shops/Ration Cards at a scale of 1.25 litres per individual in rural areas and 1 litre in the urban areas.

Ration Cards of Sikkim Govt:

Apart from the distinct family ration cards for BPL families the department has issued 4, 30,547 individual APL ration cards with digital computerized photos imprinted on it.
An individual above the age of five years is entitled to a ration card on production of documentary proof that he/she is a local resident.
Effort is being made to issue new biometric ration cards to weed out bogus/duplicate ration cards.

Fair Price Shops of Sikkim Govt:

There are 1420 approved Fair Price Shops including Co-operative Societies all over the State. All the Fair Price Shops are registered with the Department.
The Fair Price Shops are required to deposit a sum of 5000/- (five thousand) as security deposit which is returned if the Fair Price Shop wants to surrender their licence.
The District wise break up of Fair Price Shops is as under:-
South 420 North 74 West 336 East 590 Total 1420

Sikkim Public Finance and fiscal Policy

Sikkim Public Finance and fiscal Policy

Basic Understanding of Public Finance of Sikkim

Public finance as a concept may be understood on two levels –

as a practical activity of all components of public administration and
As a theoretical area.

The term “public finance“ may be defined as the identification of specific financial relationships and functions running between public administration bodies and institutions (i.e. public sector entities – the state) as one party and in mutual interaction with other entities of the economic system as the other party (i.e. private entities – households and companies).
These relationships and functions may be considered special as they include:

Procuring public goods (production and provision);
arranging and funding various transfers (particularly in the social area);
Directing entities existing in the economy towards socially desirable behaviours; for instance through taxes, penalties, subsidies and other stimuli and charges.

In order to arrange the funding of the above-mentioned areas, there is a fiscal system (public budgeting system) whose aim is to collect the required amount of public revenue. Public revenue serves, at various levels of public budgets (governmental, regional and local), to fund public expenditures.
Public expenditures, public revenue and particularly taxes may be considered to be the fundamental elements of public finance. Important terms derived from these three elements include deficit, public debt, budgetary policy and fiscal policy.
The development of public finance is connected with economic mechanisms that should ideally lead to the effective and fair allocation of limited resources.

Public Finance – Causes of Development Aspects of Sikkim

The reason for developing public funding is the state intention to soften the drawbacks resulting from economic decisions made by individual entities (households and companies). It uses fiscal tools (public revenue and expenditure) to accomplish this.
Certain behaviour is classified as the “quasi-fiscal funding principle”, where publiclaw goods are funded from off-budgetary resources (e.g. the public-law television in the Czech Republic is funded from television licence fees).
Another important term that relates to public finance, and that is also a strong argument for its development, is market failure.
The market system follows supply and demand through the price mechanism. It is a system that has developed itself, and that has strong ties with the interactions between people and companies.
All these entities strive to maximize their benefit (welfare). The greatest benefit is strongly interconnected with reaching the economic optimum condition.
A system that reaches the optimum is considered, in the neoclassical economics concept, to be efficient, fair and stable.
The ideal condition is called the Pareto optimum. This exists in an economy when none of the involved entities can improve its position without worsening another entity’s position. If any of the entities intends to improve its position, it is possible for it to do so only to the detriment of another entity. The existence of perfect competition is a necessary requirement for reaching the optimum.
The three above-mentioned elements (efficiency, stability and fairness) are connected with microeconomics from the viewpoint of efficiency, connected with macroeconomics from the viewpoint of stability, and connected with sciences outside economics from the viewpoint of fairness. The perception of fairness is investigated by other social sciences, and is closely linked to ethics, etc.
If no conditions exist for reaching a market-efficient solution, or the conditions are simply violated for any reason, market failure will ensue.
It consists of the following:

The allocation of resources is not efficient,
The economy in the area of macroeconomics indicators oscillates around the desired values and
The distribution of wealth and income may diverge from the consensus on fairness.

It is then up to the state to perform its fiscal function (the public finance function) in those three areas in order to preferably eliminate or at least reduce market failure. Specifically, those are microeconomic failures from the allocation function perspective, macroeconomic failures from the stabilization function perspective, and the redistribution function then falls into the area of market failure caused by outside economies.
If the conditions for perfect competition are not met, a malfunction in the price mechanism will arise, which disturbs the allocation mechanism. Some failures can be eliminated without public finance intervention through auto-regulation (the internalization of externalities). However, others are part of the government’s allocation function and its fiscal tools (taxes and governmental purchases or transfers).
Macroeconomic failure is indicated by instability in the economic system that usually suffers from cyclical inflation, a high rate of unemployment, low or even negative growth of production or problems in the foreign trade balance, etc.
The above-mentioned macroeconomic cases of instability are why governments perform the state stabilization functions (stabilization fiscal functions).
The state uses several tools to perform the stabilization function. The basic classification is a division into monetary and fiscal tools. The monetary tools include open market operations, the setting of basic interest rates, determining the level of mandatory minimum reserves, etc. Fiscal tools may include public expenditure, public revenue and ways of funding deficits.
The causes of market failure outside the economy relate to reaching fairness in society through the distribution of wealth and income. With the distribution of wealth, the market does not practically perceive fairness. In this case, the state performs a redistributive role with 5h3 principles of solidarity, social conscience, charity, etc. based on the social consensus.
The state performs the redistribution function through two basic categories of tools. The first includes revenue (tax) and the other expenditures (transfers, grants and subsidies).

First, a tax transfer mechanism may be implemented through a combination of progressive taxation of high incomes and transfers (subsidies) in favour of low income households.
Secondly, this can occur through the taxation of luxury goods combined with subsidies on goods for the low-income population.

Fiscal Policy Meaning

Arthur Smithies defines fiscal policy as “a policy under which the government uses its expenditure and revenue programmes to produce desirable effects and avoid undesirable effects on the national income, production and employment.”
Though the ultimate aim of fiscal policy in the long-run stabilisation of the economy, yet it can be achieved by moderating short-run economic fluctuations.
In this context, Otto Eckstein defines fiscal policy as “changes in taxes and expenditures which aim at short-run goals of full employment and price-level stability.

Objective of Fiscal Policy

To maintain and achieve full employment.
To stabilise the price level.
To stabilise the growth rate of the economy
To maintain equilibrium in the balance of payments.
To promote the economic development of underdeveloped countries

Revenue Receipt Aspects of Sikkim

Tax Revenue Comprises taxes collected and retained by the State and State’s share of union taxes under Article 280(3) of the Constitution.
Non-Tax Revenue Includes interest receipts, dividends, profits etc. Grants in Aid and Contributions
Grants-in-aid represent central assistance to the State Government from the Union Government. Includes ‘External Grant Assistance’ and ‘Aid, Material & Equipment’ received from Foreign Governments and channelised through the Union Government. In turn, the State Government also gives Grants-in-aid to Panchayati Raj Institutions, Autonomous Bodies etc.

Expenditure Aspects of Sikkim

Expenditure is classified as Revenue Expenditure (which is used to meet the day-to-day running of the Government), and Capital Expenditure (which is used to create permanent assets, or to enhance the utility of such assets or to reduce permanent liabilities). Expenditure is further classified under Plan and Non-plan across different services viz., General services, Social services and Economic Services.

General Services Includes Justice, Police, Jail, PWD, Pension etc.
Social Services Includes Education, Health & Family Welfare, Water Supply , Welfare of SC-ST etc.
Economic Services Includes Agriculture, Rural Development, Irrigation, Cooperation, Energy, Industries, Transport etc.

Medium Term Fiscal Plan for Sikkim: 2016-17

Introduction – Fiscal Policy Overview

The fiscal year 2016-17 is the second year of the award period of the 14th Finance Commission (FFC). The fiscal stress faced by the State in the year 2015-16 persisted in 2016-17 as well.
The fiscal challenges faced by the State necessitated modifications in the financing pattern based on the changes in resource transfers by the Central Government.
The share of Sikkim in the divisible pool of Central taxes has been raised to 0.367 per cent as compared to the share of 0.239 recommended by the 13th FC.
The increase in State’s and rise in the divisible pool of Central taxes from 32 to 42 percent due to the recommendations of the FFC has resulted in higher tax devolution to the State. However, rise in tax devolution subsumed many grants to the State and overall Central transfer was declined last year.
However, the State Government is committed to improve the provision of the public services and protect the spending on priority sectors while being prudent in fiscal management.
The Sikkim Fiscal Responsibility and Budget Management Act of 2010 (FRBM Act) provides the benchmark for fiscal management in the State.
The FRBM Act was enacted in the State with the objective of providing fiscal stability and conducting the fiscal policy in a sustainable manner to reduce the deficit and stabilize the debt burden.
It is expected that a rule based fiscal policy will establish long run fiscal sustainability improving the credibility of the Government policy and focus on spending to build social and physical infrastructure.
Given that the State has a limited base to generate resources internally and the provision of public services in a difficult hilly terrain is costly, the Government needs to calibrate it fiscal policy and spending pattern with a restraint provided through the fiscal rules.
The State Government, over the years, managed to adhere to the fiscal targets, while adopting a development oriented fiscal policy. The overall fiscal management in terms of budget decisions and implementation has remained within the boundary set in the fiscal rules.
The fiscal adjustment path for Sikkim recommended by the Thirteenth Finance Commission (TFC) with targeted fiscal deficit to ensure sustainable level of debt ended at 2014-15.
The FRBM Act of the State took into account the recommendations made by the 14th Finance Commission starting from the fiscal year 2015-16.The FFC recommended certain changes in the fiscal consolidation process to provide flexibility in the fiscal management of the State.
The State Government has brought amendments this fiscal to the State FRBM Act reflecting these recommendations.
The development oriented fiscal management over the years helped the State Government achieving socio-economic development and an inclusive growth process. Creating an enabling environment for different sections of the society, different tribal groups, women, and young people to participate in economic activities and contribute to the development of the State has remained as major objectives of the Government

Achievement of social sector commitments

Achievement of social sector commitments constitutes an important element of resource allocation decisions in the context of rule based fiscal policy that restricts incurring deficit and borrowing to a sustainable level. The Gross State Domestic Product (GSDP) at constant prices recorded a healthy growth rate of 7.88 percent in 2013-14.
The per capita income of the state, which was Rs.30727 in 2004-05, has increased substantially to Rs.196144 in 2016-17 at current prices. The major socioeconomic indicators for the State show commendable improvement.
The poverty ratio has declined to 8.19 per cent as compared to all India average of 21.92 per cent in 2011-12. The literacy rate at 81.40 per cent in 2011-12 is significant achievement. The IMR has gone down to 24 per 1000 in 2011 as compared to the all India average of 44.

Macroeconomic Outlook of Sikkim

The CSO has not updated the GSDP data of Sikkim for the year 2014-15. For all projection purposes, the method suggested by the FFC has been adopted to update the GSDP. The State GSDP, during 2012-13 and 2013-14, grew consistently at a reasonable rate of 7.6 and 7.9 per cent respectively.
While the service sector dominated the State income during 2005-06 to 2008-09, the share of Industry sector started increasing since 2009-10 and in 2013-14 the service sector constituted about 60.6 per cent of the total GSDP.
The relative share of industry sector has increased mostly driven by manufacturing, construction and power sectors. The inter-sectoral composition of GSDP since 2004-05 shows that the service sector, which accounted for half of the State GSDP till 2008-09, has declined to about 30 per cent in 2013-14.
The relative share of agriculture sector, which comprises of agriculture, forestry and fishing, has been declining over the years. The share of agriculture sector has come down from about 14 per cent in 2008-09 to 9.5 per cent in 2013-14.
The manufacturing and construction sectors remained as major contributors to the growth of the State economy. The year 2009-10 marks a clear shift in the growth path of the GSDP as the growth rate in this year jumped to a high of 73.6 per cent (89.9 per cent in current prices).
The impressive growth of power sector was basically driven by generation of hydroelectricity in newly commissioned power projects.
The manufacturing sector showed very high growth due to higher production in pharmaceutical industries and strengthening of small-scale industries. The manufacturing sector constitutes about one third of the State GSDP in 2013-14.
The initial burst in the growth of power and manufacturing sectors has stabilized in recent years. However, this established a strong base for the GSDP in Sikkim.

Fiscal Profile of the State

The Changing Fiscal Architecture and Its Impact on Sikkim

The budget for the year 2016-17 was the second budget after the FFC gave its recommendations on devolution of resources to the States. Despite the rise in share of Sikkim in tax devolution, aggregate transfers to the State declined in 2015-16 relative to GSDP due to sharp decline in grants.
Based on the tax devolution share for Sikkim and grants recommended by the FFC, the State received less central transfers in 2015- 16 as compared to 2014-15. The loss of assured source of block grants has created fiscal stress for the State and it seems unlikely that the increased tax devolution would compensate for this.
The FFC increased tax devolution to the State from 32 per cent to 42 per cent to provide higher flexibility in the use of enhanced level of untied fund.
As the FFC relied on tax devolution to cover the assessed revenue expenditure needs of the States, it took a holistic view of the revenue expenditure needs of States without Plan and Non-Plan distinction.
The FFC departed from past practice by not awarding specificpurpose grants. These grants, according to the Commission, were small to make any impact and crate confusion where large Plan schemes already exist, and were left to the Centre and the states acting cooperatively for those needs. The only grants awarded by the Commission were disaster relief grants and grants for local bodies.
The Commission was required by their terms of reference to recommend grants for these two purposes. The commission steered clear of both the Plan/Non-Plan distinction and that between special-category and other states.
Consequent upon the enhancement of share of the states in the central divisible pool from the current 32 percent to 42 percent which is the biggest ever increase in vertical tax devolution, Central Assistance to State Plan has been restructured.
The Central Government has discontinued the normal central assistance (NCA), special plan assistance (SPA), special central assistance (SCA), and the additional central assistance (ACA).
The Central Government also delinked eight centrally sponsored schemes (CSS) from funding and brought about substantial changes in the funding pattern of some other schemes.
The higher growth rate assumed by the FFC resulted in higher assessed revenue of the State during the award period of the Commission.
The own tax revenue projected for 2015-16 by the Commission is Rs 876.00 crore (calculation is based on GSDP of Rs 20634 crore), which rises to Rs.3039 crores in the year 2019-20.
Higher tax projection by the Commission reduced the pre-devolution revenue deficit gap for the State during the award period. The FFC projected revenue receipts seems to be unachievable.
The FFC transfer to the State also depends on the resource mobilization by the Central Government. While the FFC recommended Rs.2129 crores as share in Central Taxes to Sikkim, the Union budget for 2015-16 provided Rs.1929 crores only.
The actual flow however, was much less at Rs.1870 crores. This implies a gap of Rs.259 crores, which is expected to grow in the future years unless the the Central taxes increases considerably.
Decline in Central Grants and the gap in actual flow of tax devolution to that of the budget projection makes it very difficult to provide funds to the infrastructure projects started earlier based on the fund flow mechanism existing under the then Planning Commission and the Finance Commission.

Expenditure Profile

The Government of Sikkim has successfully controlled the revenue expenditure as percentage to GSDP. This has helped the State to increase the revenue surplus and expand the capital expenditure.
The priority sectors in social and economic services were traditionally given emphasis in resource allocation. The State Government has initiated several schemes in education and health to improve overall social and human infrastructure in the State.
The revenue expenditure, which was at 29.8 per cent relative to GSDP in 2009-10, was compressed to 23.12 per cent in 2014-15 and was budgeted at 23 percent in 2016-17. While the level of expenditure on social and economic services was protected in 2015-16 as compared to the previous year, the level of spending relative to GSDP projected for the year 2016-17 was low.
The expenditure compression in 2016-17 was due to lower availability of resources.

Outstanding Debt and Government Guarantee

Maintaining the debt burden of the State at sustainable level remains one of the major objectives of the fiscal management of the State as reflected in the FRBM Act.
The TFC in their revised fiscal roadmap have worked out the yearly outstanding debt burden for all the states aligning with the fiscal path.
The debt-GSDP ratio in the State has been reduced considerably, which is projected to be 23 per cent in 201617 BE.
The decline in the average cost of debt of the state because of the debt restructuring formula of the Twelfth Finance Commission has helped to lowering the debt burden.
Decline in the average cost of debt will result in reduction in the volume of interest payments and availability of higher fiscal space for the state government.
The interest payment has declined from 2.5 per cent in 2009-10 relative to GSDP to 1.6 per cent in 2016-17 (BE).

Medium Term Fiscal Plan: 2016-17 to 2018-19

Fiscal Indicators

The fiscal outcomes in the form of indicators like fiscal deficit, revenue deficit, and outstanding liabilities for previous year, current year, ensuing budget year and two outward years are presented.
The fiscal outcomes of the year 2014-15, for which audited figures are available, show that the State Government has adhered to the fiscal targets under the Act. In the year 2015-16, the Government took the benefit of flexibility provided by the FFC to raise the fiscal deficit to 3.25 percent to GSDP.
However, due to slippage in revenue receipts, the fiscal deficit has increased to 3.31 percent. The budget projections of the year 2016-17, however, show that the fiscal deficit has been contained at 3 percent of the GSDP. The Government managed to generate revenue surplus all along.
The projections for the budget year, 2016-17, and for two outward years, which give a medium term perspective to the fiscal stance, is aligned with the FRBM Act. The MTFP from 2016-17 to 2018-19 conforms to the recommendations of the FFC to anchor the fiscal deficit to 3 per cent of GSDP.
The MTFP 2016-17 presents the outlook of the fiscal management of the State Government in the medium term. The detailed projection of fiscal variables show that the revenue account surplus has been maintained during the MTFP period and the fiscal deficit has been stabilized at 3 per cent relative to the GSDP.
Despite reducing the revenue expenditure from 23 percent relative to GSDP to about 22.3 percent, the revenue surplus could not be increased due to low growth of revenues relative to the GSDP.
While GSDP is assumed to grow at 17.69 percent, the total revenue receipt grow at about 16 percent. The loss of block grants has pulled down the aggregate revenue receipts.
In nominal terms the revenue surplus increases from Rs.260.51 croers in 2016-17 (BE) to Rs.359.81 crores in 2018-19. Despite rise in fiscal deficit in nominal terms, it remains at 3 percent of GSDP, the mandatory requirement under the FRBM Act. The outstanding liabilities declines from 23.18 percent in 2016-17 BE to 22.29 percent in 2018-19.
As indicated, due to higher growth of GSDP, the fiscal variable in the medium term show a lower value. However, there has been substantial growth in revenue receipts and allocations to various sectors in nominal terms. While revenue receipts increases from Rs.4885 crores to Rs.6580 crores in the medium term, the revenue expenditure rises from Rs.4625 crores to Rs.6221 crores. The growth of revenue expenditure remains below the growth revenues.
The provision for capital outlay has increased from Rs.847 crores to Rs.1178 croers during MTFP period. Relative to GSDP, the capital outlay has shown an increase in the medium term.
Despite pressure on revenue receipts and competing demands, the focus on investments in infrastructure will remain a key factor in fiscal policy of the Government.

Summary Assessment

The State of Sikkim continues to face fiscal stress for the second year in a row after the fiscal architecture involving the fiscal federal arrangements have changed following the FFC recommendations.
As the Central transfers constitute a large portion of the State’s budget, the loss of some of assured source of revenue from plan grants has created difficulties in resource allocation in the State.
Although, the fiscal indicators show a declining trend due to high growth of GSDP, the nominal numbers show growth in revenues and resource allocation. The growth in resource allocation, particularly in the priority sectors in social and economic series and capital outlay has been restrained.
This has added increased responsibility on the State Government to generate higher revenue and continue with the traditional policy of emphasizing social and infrastructure sectors.
Despite the pressure on resources, the MTFP indicates a stable and growth oriented fiscal policy for Sikkim. The rise in production of electricity and growth of the manufacturing sector influenced the economic growth of the State in recent years.
The fiscal policy has to create an enabling environment for further growth and socioeconomic progress.
The resource allocation in the medium term focuses on enhancing the capital expenditure and social and economic sector spending. The economy needs better infrastructure and human development to make progress. The State Government has initiated several schemes in the social and economic sectors in recent years.
Despite the problem of cost disability, the State is committed to improving the service delivery spanning over the social and economic sector. The MTFP safeguards the fiscal consolidation process and provides adequate resources to existing schemes in priority areas.
The FFC recommended anchoring fiscal deficit to 3 per cent of the GSDP. The MTFP continues with the fiscal target set for fiscal deficit at 3 per cent. As debt stock in the State relative to the GSDP remains low, the debt-GSDP target remains stabilized. While projecting State taxes, the MTFP assumed higher buoyancy to augment resources, which will be achievable in the medium term.
The modernization of tax administration and efforts to improve the tax base is expected to improve the revenue receipts. It was observed that there has been some uncertainty in the flow of share in Central taxes. The tax devolution to the State varies depending upon the collection of Central taxes as the Finance Commission recommends a share in the divisible pool.
In the year 2015-16, against a budgeted amount of Rs.1924 crores, which was also less than what the FFC projected, the transfer to the State was only Rs.1870 crores. This level unpredictability affects State finances adversely.
The expenditure side restructuring in the MTFP was based on the realties regarding the resource availability and priorities expressed Government’s policies, and new schemes announced in the budget.
The MTFP protected the capital outlay relative to the GSDP and raised it marginally during the MTFP period. The rise in nominal terms is substantial. The rise in the capital expenditure will be instrumental in strengthening the infrastructure base in the State.
The State Government will be able to enhance the level of capital expenditure with the improvement in resource position.
What is important is to develop a policy to focus more on productive capital expenditure. The debt burden of the State remains below the limit suggested by the FFC to gain from the flexibility clause regarding the fiscal deficit.
The State Government has amended its FRBM Act in 2016-17 to avail the facility of increasing the borrowing limit and consequently the fiscal deficit by 0.25 present separately based on the FFC recommendations.
This will further help in maintaining the fiscal discipline and stability, adequate resource allocation to social and economic sector and strengthening infrastructure base.

The highlights of the Budget for the year 2017-18 with a summarized account of the receipts and disbursements incorporated in the budget.

A	*RECEIPTS*	*AMOUNT* *(in* *crore)*
1	Tax Revenue	669.51
2	Non Tax Revenue	426.46
3	State’s Share of Central Taxes	2477.78
4	Grant in Aid	1752.56
5	Gross Borrowings	881.60
6	Recoveries of Loans and Advances	0.80
7	Net Public Accounts	13.10
A	*Total* *Receipts*	*6221.81*
B	*EXPENDITURE* *(net)*
1	Revenue Expenditure	4613.47
2	Capital Expenditure	1608.35
B	*Total* *Expenditure*	*6221.82*

Languages and Literature of Sikkim

Languages and Literature of Sikkim

Today, all the main languages spoken in Sikkim have been given the status of a “State language”.
Notably, Bhutia, Lepcha and Limboo languages have been included in college curricula, while other languages, such as Rai, Gurung, Pradhan (Newar), Mangar and Tamang, are taught till the secondary school level.
Financial help is directly given to different communities to promote research in their respective languages
Sikkim is inhabited by over twenty ethnic communities, each unique in their tradition, customary practices, language and attire.
The outstanding beauty of these people living in harmony and sharing in amity each other’s cultures, ethos and traditions is a colourful mosaic of Sikkimese society

Bhutia People Language of Sikkim

Bhutias are divided into two groups – Tongdu-ruzhi with four clans and Bebtsengyed with eight clans, though there are a number of other sub castes.
They speak and write in the Bhutia language which is also called Lhokey although their script, language, religion, dress and ornaments have semblance with the Tibetans.
The Bhutia language, a long with the Lepcha and Limboo languages are taught in Sikkim till t he univer ity level.

Lepcha People Language of Sikkim

They have their own language, known as ‘Rongring’, with its script, ‘Mutanchi Rong Aming’.
The State Government has accorded official status to the language, along with the Bhutia and Limboo languages.
Since the year 2000 it has been taught in schools and colleges in Sikkim and from 2016 it has been taught at the university level.

Bhujels People Language of Sikkim

They have their own language, called Puhgal Gnur which is a part of the Tibeto-Burman sub-family and Sino Tibetan family of languages.
Some o f them converse in their own language .

Gurungs People Language of Sikkim

Gurungs have their own language, Tamu Kye and script, Khema.
The Gurung language (along with six others) was given official status in 1995 by Chief Minister Pawan Chamling, and is being taught in selected Government schools up to the secondary level.
Text books, magazines and dictionaries have also been published in Tamu Kye.
Since 2001, the Gurung edition of the Sikkim Government weekly newspaper, the Sikkim Herald, is also being taken out.

Jirels People Language of Sikkim

Jirels are known to have an ethnic and linguistic semblance with the Sherpas and Central Tibetan tribes.
Their language, like the Sunuwar language, is also a part of the Kanauri branch of Tibeto-Burman.

Kagatey People Language of Sikkim

The community is divided into several sub-groups like Dongba, Sarpa, Shyangba, Lama and Chyaba.
They speak in Kagate, a language of the Kyirong-Kagate language sub-group of the Sino-Tibetan language family, which has similarities with languages of Yolmo, Sherpa and Bhutia

Majhis People Language of Sikkim

Majhis converse in their own language but have no script of their own.
They are dark brown in complexion, medium in height and well built, and have classic Mongoloid features

Mangar People Language of Sikkim

They have their own language, belonging to the Tibeto-Burman family, and also have their own script, ‘Akkharika’.
In 1995, the State Government recognized this language as one of the State languages of Sikkim along with the Rai, Gurung, Tamang, Sherpa, Newar and Sunuwar languages.
The teaching of the Mangar language is being introduced in schools that have the greatest number of Mangar students

Newars People Language of Sikkim

The Newars have their own language.
They used to have a number of scripts as well but in Sikkim the “Prachalit” script is the one in use.
The “Ranjana” script is used in Buddhist Monasteries and the Tantric Kutaktshar Mantra of Buddhists consists of seven letters of Ranjana script.
The Newar language has been declared an Official Language of Sikkim in 1995 and has been introduced in selected Government schools’ curricula from the year 2002.

Rai People Language of Sikkim

The Rai or Kirat Khambu Rai community is one of Sikkim’s major indigenous ethnic communities and has been living in Sikkim from ages past.
Their language and script, which belongs to the Tibeto-Burman family of languages, was recognised as one of the official languages of Sikkim with effect from 31 March, 1995 vide the Languages (Amendment) Act, 1995, and published in the Sikkim Government Extraordinar y Gazette No. 76 dated 21 April, 1995.
This language has, since the year 2002, been taught in various Government schools in Sikkim.

Sherpas People Language of Sikkim

They have their own dialect, which belongs to the Tibeto-Burman languages, and they use the Sambhota script as a medium of writing books in their language.
The Government of Sikkim granted official status to the Sherpa language in 1995 along with other languages and the language is being taught in selected Government schools up to the secondary level.
The Sikkim Herald – the official newspaper of the Sikkim Government – Sherpa edition started publication in the year 2001 and has since been in print on a weekly basis

Sunuwar People Language of Sikkim

Mongoloid in appearance, they speak both in Nepali and Koinchlo, which originates from the Sino-Tibeto-Burman family of languages.
Their script is believed to be of ancient origin and possesses only six vowels and twentyfour consonants.
Koinchlo was recognised by the Sikkim Government under the Sikkim Official Languages Act, 1977, and is being taught in Government schools till Class V.
Since 2001, the Sikkim Government weekly newspaper, Sikkim Herald (Sukhim Neskutek) is also being produced in the Koinch language.

Yolomo People Language of Sikkim

Theys peak the Yolmo language o f the Kyiron g-Ka gate branch of the Sino-Tibetan language family, which has a similarity to the Kagatey, Sherpa and Tibetan languages.
They use the Sambhoti (Tibetan) script, though modern academics pre fer to use the Devana gari scri pt as well.

Thakuri People Language of Sikkim

They speak and write Nepali, using the Devanagari script.
But their spoken language is markedly different from that of common Nepali.
For instance, Thakuris use the word ‘darshan’, instead of ‘namaste’ or ‘namaskar’.
Claiming to have belonged to Rajgharana, they also use a respectable dialect of Nepali like “maiya sahiba”, “babu sahib,” “yuraj,” dulahi rani,” “muma hajur,” “buba hajur”, “khaisyo”, “laisyo” etc.

Handicrafts of Sikkim

Handicrafts of Sikkim

Traditional arts and handicrafts have been the very breath of Indian Civilization visa-vis Sikkim too.
Significantly, Sikkim is also known for its traditional handicrafts, paintings, motifs, carpet, traditional tribal shoes, dresses, ornaments, weaving, and so on.
The traditional handicrafts in Sikkim had has enormous cultural significance.
Many of the Bhutia and Lepcha as well as Nepalese are engaged in traditional handicrafts production of Sikkim.

Handloom Weaving of Sikkim

In ancient times, the Lepcha’s of Sikkim were said to use yarn spun out of stinging nettle (sisnu) plant to weave clothes.
Today cotton and woollen yarn are used together with vegetable dyes and synthetic colours.
Lepcha weaves or ‘thara’ is woven in vertical looms with a backstrap. Such looms are of small width.
Traditional design with different colours are used to make tharas which are used for making bedspreads, bags, belts, curtains, cushion covers, table mats, tray cloths etc, apart from their traditional dress.

Woodcarving of Sikkim

It is one of the most important crafts of Sikkim.
Traditionally, only the Buddhists Bhutias and Lepchas used to practise wood carving. Indeed, wood carving is an ancient art form of both the Lepchas and Bhutias of Sikkim.
The items of woodcraft having wide range of variety can be found from household items to partitions to eight Buddhists lucky signs.
Woodcrafts are available in the following shapes choktse or table, almirah, sofa-sets, drawers or bhodin , screens, lamp stands, cheosum or altars, wall decorations, etc.

Wooden mask of Sikkim

One of the most important materials items of Buddhists’ traditional culture that has special socio-religious significance is wooden mask of various types being used during their religious dances by the Lamas.
The masks are carved out of the tough light wood of the giant climber called Zaru-shing, mostly found in the high altitude areas of Sikkim.
While in Tibet they were composed of mashed paper and cloth.
In all cases they are beautifully painted and varnished, and are provided with yak tail wig.
Each mask has a specific meaning and a story with certain religious connotation associated Various Wooden Masks with it.
Traditionally the mask dances are staged by the Lamas or monks in the Gonpas or Monasteries.
Such dances are normally performed only by men in the monasteries.
There are different types of mask normally made by Bhutias and Lepchas like mask of Khangchendzonga, mask of Garura, mask of Mahakal, etc.

Thangka Painting of Sikkim

The important Thangka is a paintings of divinities or group of divinities on silk clothes which depicts different incarnations and life of Lord Buddha, Goddess Doma (Tara), Guru Padmasambhav or God Chana Dorji or for that matter, any Tibetan saint, wheel of life (one of the purest Buddhists emblems) or some other deity, surrounded by deities of lesser significance etc.
Thangkas are the religious scrolls found hung in monasteries and houses of Buddhists.
It has an excellent tradition in Sikkim.
Such paintings are considered very auspicious and are supposed to drive away evil spirits.
Thangka painting is a renowned art of Sikkim.
“The Thangka works of master craftsmen sell for thousands of rupees abroad. They work in seclusion in remote villages” as cited by exgovernor of Sikkim namely Taleyarkhan (1981)

Cane and bamboo work of Sikkim

It is also the traditional handicraft Bhutias, Lepchas and Nepalese of Sikkim.
Cane and bamboo pieces are first of all split by using simple tools like Khukri or knife to make thin strips.
Thereafter the strips are sized as per requirement and are then intricately woven and modified and improved upon as per the graphical design.
There are varieties of cane and bamboo-craft products like, fruit, baskets, bamboo flower sticks bear mugs, hair clips, tea-trays, tea strainers, spoons, flower vases, piras, mats, hats and tumblers.
In Sikkim bamboo grows in abundance. But the cane is grown only in limited areas; thereby bulk of it comes from neighboring Siliguri or other parts of the North East.

Preparation of Lucky signs of Sikkim

Another important handicraft is the ‘Lucky signs’ mostly made by women in Sikkim.
The lucky signs are made by adopting two types of methods

one type of embroidery work done by using needle on silk or ‘sharteen’ clothes
Another is the paintwork (fabric) on silkl’shirteen’ clothes.

Such lucky signs are presented either in the form of words or symbol. It is used as wall hanging and means the ‘symbol of peace’.

Hand-made paper making of Sikkim

It is another important handicraft item.
Apart from other units, there is another important section namely Handmade – paper unit in the Government Institute of Cottage Industry at Gangtok, Unit was opened in the year of 1962.
Handmade paper, namely ,

Rayon paper (used for rapping);
Rags paper (used for making files);
Card sheet (used for making greeting cards and paper bag).

Raw materials are used to be brought from Kolkata.

Carpet Weaving of Sikkim

Traditionally, carpet (locally known as Den) weaving is a symbol of cultural expression in the state of Sikkim.
Besides, Carpet is very important export oriented handicraft industry in Sikkim.
The carpets are of with various exquisite and intricate designs, motifs and colours which are typical of Sikkimese type and made of various sizes.
The price ranges vary according to size and quality of the particular carpet. Carpet weaving is dominated Carpet product by women.
Though it is a traditional activity, very few families follow it as apart of family tradition.

Blanket Weaving of Sikkim

It is also one of the traditional handicrafts of Sikkim
It is normally done by women particularly in North Sikkim.
The blankets are woven on loom, and the raw materials are available in local market.
There are mainly two sizes of blanket available i.e. 4 ft. by 6ft. and 4 ft. by 7 ft.

Soft Toys of Sikkim Supported by Sikkim Government and GoI

The Soft Toys Production unit of the Directorate of Handicrafts and Handloom, Zero Point, Gangtok is one of the prominent sectors for support and creation of self employment in Sikkim.
This sector is being re-energized into a home to home industry through a project initiative namely “Production and Training for Soft Toys at Gangtok, Sikkim “funded by the North Eastern Council, Ministry of Home Affairs, Government of India and also Government of Sikkim.
The toy making craft is an activity that can supplement and contribute to the family income and also create self employment.
The focus of the department is therefore to facilitate continuous capacity building and skill upgradation in this sector and thereby create a resource base of trained manpower.
Quality standardization and product diversification are two important areas of focus and therefore the best raw materials for creation of quality products are being used in the training centres.
The training module has been oriented in such a manner so as to emphasis and promote products that are closely connected with the environment and also identify with the local ethos.
Our main motto is to offer quality products to our valued customers at competitive prices.
The Soft Toys Sector provides self employment and income to the large number of artisan in terms of quality and cost comparativeness of the soft toys products of DHH are compared to the best of the world.
Presently, one project on “Production and Training on Soft Toys at Gangtok, Sikkim” funded by North East Council is underway and 225 numbers of trainees are being trained all over the state.
The department is required to ensure placement and create self employment for the trainees within and outside the state.

Sikkim is one of the fastest growing states in India. The state has favorable agro-climatic conditions, which support agriculture, horticulture and forestry. As per the state budget 2016-17, Sikkim got certified as first fully organic state in India by the Central Ministry of Agriculture and Farmers’ Welfare as well as other recognized agencies of the country.

Between 2004-05 and 2015-16, Gross State Domestic Product (GSDP) expanded at a compound annual growth rate (CAGR) of 19.44 per cent to US$ 2.75 billion whereas the Net State Domestic Product (NSDP) expanded at a CAGR of 19.11 per cent to US$ 2.33 billion.

The State Government has achieved remarkable progress in the core areas of agriculture, health, education and development in infrastructure. Today, Sikkim is the most talked-about state in the Country.

Sikkim has evolved as a progressive State with marked improvements in socio-economic indicators, despite facing the disadvantages of inadequate connectivity, high cost of infrastructure building and maintenance, difficulty in delivering services to dispersed populations in hilly areas.

People of Sikkim engage in different economic activities, prominent among which are Tourism, Industries, horticulture & agriculture etc. giving rise to a definite occupational structure. Major contributions to the economy are provided by sectors like Agriculture, Horticulture, Forest, Mining, Industries, Power, Tourism, Aqua Culture and Livestock etc.

Agricultural economy

The state’s economy is largely agrarian, based on the terraced farming of rice and the cultivation of crops such as maize, millet, wheat, oil seeds, pulses, spices, cereals barley, oranges, tea and cardamom.

Agriculture is vital to the progress of Sikkim as more than 64% of the population depends on it for their livelihoods. The Sikkim AGRISNET is an internet-based agriculture information centre to promote scientific agricultural methods and convert research into practice in the agricultural sector. Sikkim has a suitable climate for agricultural and horticultural products. It supports multiple crops; viz., rice, wheat, maize, millet, barley, urad, pea, soya bean, mustard and large cardamom. The surveyed arable land in Sikkim is 109,000 ha, of which only 9.5% is used, this provides a vast untapped potential for development. The state government is also laying emphasis on improving organic farming in the state.

Agriculture is the major economic activity and is practiced on terraced field that has been laboriously created from steep hillsides. There are in all 689 enterprises that have been identified, which are mostly concentrated in rural areas.

Sikkim is the largest producer of cardamom and also boasts to utilize largest area for its cultivation. Tea is exported to USSR & Germany. A coffee plantation has also been started at Majitar.

The economy broadly depends on the agriculture which provides livelihood to the majority of population in the state. However, it’s progress remained limited due to difficult topography and other natural barriers. As a result all head sectors related to agriculture emerged, government is doing its best to improve the situation.

Horticulture

Horticulture also contributes to the economy of Sikkim. Large Cardamom, ginger and turmeric are the principal crops while Mandarin orange, guava, mango, banana and so on are the principal fruits grown in the state. The department of Horticulture is deeply involved in motivating and providing technical guidance to local farmers. Sikkim is also a paradise for flowers. Gladioli, anthuriums, lilliums, primulas, rhododendrons, orchids as well as many other floral species thrive here. The state is home to an amazing 450 species of exotic orchids alone. There is immense potential for developing floriculture on a commercial basis here, and the department of Horticulture is making concerted efforts to turn this sector into an export-oriented industry.

Forest

Sikkim has rich bio diversity and thus provides economic activities. The total land area managed by and under administrative control of Forest Department is above 80% of the total geographical area of the state. The composition ranges from tropical Dry Deciduous Forests with Sal and its associates in the valleys of Teesta and Rangit to the Alpine Scrub and Grasslands in high altitudes. During the two last decades Forest Department has laid emphasis on development of fodder and fuel wood in the agriculture fallow lands of the villagers giving priority to plantation of broom grass for fodder and for economic up liftment of the villagers.

Aqua Culture

Pisiculture is an important area of economic activity particularly in the context of enabling the rural people. The state’s natural resources endowments with an extensive network of freshwater rivers, lakes and streams offers conditions which are conducive for development of inland fisheries where a variety of carps and trout’s can thrive. With a view to exploit these natural resources endowments.

Sericulture

Mulberry, muga, eri and oak-tussar are cultivated in Sikkim. The Sericulture Directorate is responsible for development of sericulture in Sikkim. The sericulture potentiality of Sikkim state has been explored jointly by the State Department and Central Silk Board, through launching a flagship programme titled Catalytic Development Programme. Over the years with consorted efforts from the both ends (state and central governments), considerable success have been achieved by the state sericulture industry in generating employment. Raw silk production in the state increased from 0.20 metric tonnes in 2013-14 to 6.0 metric tonnes in 2015-16.

Livestock

Animal Husbandry provides an additional source of income to the people. Animal husbandry form an extremely important element in the effort to bring about substantial improvements in living standards. The overall area available for agriculture operations is limited to about 15% of the geographical area of the state and with the increasing population, per capita land availability has been consistently declining, it is therefore, essential, that supplementary sources of income should be developed in order to provide not only the much needed support to the rural families but also to make available in increasing quantity, protein rich food items such as milk, egg, and meat. Adequate number of livestock like cattle, buffaloes, pigs, sheep’s, goats, yaks and few other are reared in Sikkim. Yaks are reared in north eastern ranges bordering Tibet, Bhutan and western region bordering Nepal.

Industries and Mining

The Commerce and Industries Department of Sikkim is involved in promoting trade and industry in Sikkim. The Sikkim Industrial Development & Investment Corporation Limited (SIDICO) is the state-level institution engaged in promoting, financing and developing the tiny and small scale industries (SSI) sector in the state.

Brewing, distilling, tanning and watch making are the main industries located in the southern regions of Sikkim. A small mining industry exists in the state, extracting minerals such as copper, dolomite, talc, graphite, quartzite, coal, zinc and lead. Sikkim has identified Rangpo-Gangtok, Melli-Jorethang, Jorethang-Rishi and Ranipool-Gangtok as industrial corridors with provision for giving land to investors on a lease basis.

The units that are engaged in the manufacturing sector are mainly dealing with pharmaceuticals, chemicals, liquors, foam mattresses, food products, iron rods, etc. Sikkim has identified agro-based industries, horticulture and floriculture, minor forest-based industries, animal husbandry and dairy products, tourism-related industries, IT including knowledge-based industries, precision oriented high value-low volume products, hydro-power, tea, education and hospitality as thrust sectors. The Information Technology (IT) Department, Government of Sikkim is in the process of setting up a state-of-the-art IT Park and National Institute of Electronics and Information Technology (NIELIT) at Pakyong.

Pharmaceuticals

Pharmaceutical is an emerging industry in Sikkim due to tax incentives offered by the state government as well as low manufacturing and labor costs. Sikkim is home to 14 major pharma companies, which have significant investments in the state. The North-East Industrial and Investment Promotion Policy, 2007 and the pollution free atmosphere are highly beneficial for pharma investments in Sikkim. Some of the policy incentives are: 100% excise duty exemption on finished products. 100% income tax exemption. 30% capital investment subsidy on investments in plant and machinery.

The policy of framework in regard to industrialization in Sikkim has to be formulated keeping in mind the particular factors endowments that the state has the limitations in regard to resources, particularly, minerals and industrial raw materials as well as man power. The state is not so rich in mineral resources and apart from the deposits of copper, lead and zinc, no other viable and exploitable mineral deposits have so far been discovered. While on the other hand the state enjoys a tranquil climate, a dust free atmosphere and peaceful industrial entrepreneurial talent, has also to be taken note of. In regard to industrial development, a number of small and medium units have been promoted in the state. For example, The Sikkim Time Corporation (SITCO) and Government Institute of Handicraft and Handlooms.

Mining

The state of Sikkim is endowed with rich geological resources. The department of mines and geology has been responsible for exploration and establishment of mineral resources, with the object of developing commercially exploitable mineral resources. Moderate to fair amount of success has been achieved during the investigation carried out by different agencies in certain sectors namely dolomite, coal, quartzite, graphite, lime stone, silliminite, talc, mineral water, thermal springs, building stone and materials for porcelain.

Tourism

Tourism provides the main thrust to the economy. With the tranquil climate, the natural beauty and the fine cultural heritage of Sikkim, the growth of tourism has immense possibilities. There are large number of places of tourist attraction particularly the snow clad mountains, the lakes and unspoiled forest areas and valleys of flowers. The advantage of having very fine monasteries in Sikkim can also be taken to attract Buddhist tourists from countries like Japan and the South Eastern countries.

Sikkim was the first to promote the concept of eco-tourism, village tourism and home stay tourism in the country. This essential concept promoting man-nature affinity has been recognized as a new model of tourism. Today, Sikkim is already on the national and international tourism map.

Sikkim has been featured and ranked 17th in the New York Times “52 best places to go in 2017”. Similarly, Sikkim has also been featured as the best destination to visit in the world in 2014.

The Year 2017 has been declared as the Year of Sustainable Tourism for Development, an area of development in which Sikkim has already made considerable strides with eco-friendly tourism and the development of innovative initiatives such as Chaar Dham and Tathagatha Tsal. Additionally, Gangtok City has been recognized as the safest tourist destination in the country.

Keeping nature at the backdrop, the State Government proposes to promote tourism mainly through nature based tourism. Few activities which are proposed include, Rock Art Sculpture, Folk Healing Center and Yoga Sthan. In the niche Tourism Sector, facilities such as golf courses, water sports etc, are being proposed.

A priority has been given to create mega projects, one example of which is the Sky Walk at Bhaleydunga. The Ropeway to Bhaleydunga, currently under progress is expected to be completed in 2 years time. Today, Sikkim having been featured in leading International Journals and magazines, has become one of the most sought after destinations and caters to all types of tourists. Film tourism is also catching up fast with the support of the government, as many recent film shoots by popular Bollywood artistes in the state takes place.

Through sustainable forest management practices and massive afforestation drives, about 72.60 lakh saplings have been planted till date under the State Government’s flagship programmes such as Smritivan, State Green Mission, Ten Minutes to Earth and Paryavaran Mahotsav. The forest and tree cover of the State has increased by about 4% over the last two decades from 43.95% to 47.80%. The State Government has also banned the use and sale of disposable Styrofoam products, prohibited the burning of tyres, agricultural waste, use of packaged drinking water bottles, bursting of crackers in Sikkim which are first such prohibitions imposed in the entire world.

The declaration of the Khangchendzonga National Park as UNESCO’s World Heritage Site on 17th July, 2016 at Istanbul, Turkey, is a testimony to the tireless efforts of the government. The Khangchendzonga National Park has also been declared as one of the 100 top Green Destinations of the world for the second consecutive time. In addition to this, the State Government is also proposing to develop a world class Biodiversity Park and Ecotourism Centre at Tendong, South Sikkim.

The State Government has now prioritized the construction of a Ropeway from Pelling to Sangacholing Monastery in West Sikkim connecting the landmark statue of Lord Chenrezig, that is near completion, to Pelling. This project along with the Statue of Lord Chenrezig would be a great value addition to tourism in boosting tourism footfall in the State. The boost in the tourist footfall is very encouraging as Sikkim hosted over 8 lakhs tourists in 2016 alone.

Major initiatives taken by the government to promote economy of the state

The state government launched Sikkim AGRISNET, an internet-based agriculture information centre, to promote scientific agricultural methods and convert research into practice in the agricultural sector.

The Government of Sikkim has placed information technology high on its agenda. The budget allocation for information and broadcasting is expected to be US$ 0.96 million during 2015-16.

Pharmaceutical is an emerging industry in Sikkim due to tax incentives offered by the state government as well as low manufacturing and labour costs. Sikkim is home to 14 major pharma companies, which have significant investments in the state. These include Cipla, Sun Pharma, ZydusCadila, Alembic, IPCA, Alkem Lab, Intas Pharma, Torrent Pharma and Unichem.

The Sikkim government has announced a technical collaboration with floriculturists from the Netherlands and Thailand to develop the state’s potential in floriculture and market cut flowers from the state globally.

The Department of Information Technology, Government of Sikkim is in the process of setting up an IT park and National Institute of Electronics and Information Technology (NIELIT) at Pakyong. The IT Park will have state-of-the-art facilities that will offer a plug and play environment and cater to the specific needs of the information technology and business process outsourcing (BPO) segments.

In order to give a boost to handloom and handicrafts sector, the Government of Sikkim has been making several efforts, which include providing training to upgrade the quality and designs of the products; bringing expertise and professionals for their marketing and supply, etc.

The Sikkim Government plans to set up Tea Development Corporation of Sikkim, which would be the nodal agency for developing the tea Industry in Sikkim. It would work to expand the Temi tea estates in the state and acquire new gardens either wholly or partially owned by the government.

The Sikkim Manipal University (SMU), a partnership between the Government of Sikkim and Manipal Education and Medical Group (MEMG), provides technical, healthcare and science education. It is rated as one of the top universities in the country.

The State Government is very concerned with the youth populace and therefore, has laid special emphasis to skill the youth and to make them employable and self-dependent so that they can lead a life of self-respect and confidence. A separate Department of Skill Development & Entrepreneurship and Capacity Building therefore has been setup with its network of the State Institute of Capacity Building, Livelihood schools, Industrial Training Institutes, Kaushal Kendras and Incubation Centres for skilling the youth. These initiatives aim at creating opportunities for self-employment, for industrial wage employment, and community based employment as Social Entrepreneurs.

Till December 2016, a total number of 10,151 trainees have been trained in sectors such as Beauty & Wellness, Tourism & Hospitality, Apparel, Homestay, Driver cum Tour Guide, Primary Teacher Training etc. An Atal incubation centre has been approved by the Ministry of Skill Development in Assam Lingzey. Two more incubation projects for the distillation of lemon grass oil has been set up in Kerabari, South Sikkim, and Timberbong, West Sikkim, under the Rastriya Krishi Vikas Yojana.