Development Watch – Week #2 Jan’25

Development News

---

Rural-Urban inequality declining with Govt Initiatives

Income inequality in India has steadily declined over the years with the support of government initiatives and social welfare programmes. The income share of top 10% of the population, which was 1.82 times higher than the bottom 50% in 2004-05, declined to 1.34 times in 2022-23. National Rural Employment Guarantee Scheme (NREGS), Direct Benefit Transfer (DBT) and various other financial inclusion initiatives have played a key role in uplifting the bottom 50% of the population. The analysis is based on household income surveys conducted by National Council of Applied Economics Research (NCAER) and People’s Research on India’s Consumer Economy (PRICE). Data shows that middle 40% of the population continues to account for the largest share of income, followed by the top 10%.

Small businesses to drive Rural Jobs

The Prime Minister emphasized rural empowerment, speaking at the Grameen Bharat Mahotsav 2025. The Mahotsav is organized by the National Bank for Agriculture and Rural Development (NABARD) and its associates. He highlighted government initiatives for improving rural livelihoods and diversifying incomes. He stressed setting up more Farmer Producer Organizations (FPOs) and cooperatives. The Household Consumption Expenditure Survey showed increased spending in rural areas. Finance minister Sitharaman said government schemes are focused on the poor, youth, farmers, and women. FPOs are helping cultivators get better prices for their produce and urged that more of these be set up. Emphasizing the need to diversify rural incomes, he noted the importance of making irrigation affordable, promoting micro-irrigation, creating more rural enterprises, and maximizing the benefits of natural farming for the rural economy, urging time-bound efforts in this direction.

Electric car sales increase by 20% in 2024

Electric car sales in India rose 20% in 2024, closing the year just below 100,000 units sold compared to 82,688 the previous year. Price cuts toward the end of the year is said to have boosted the sales. This growth occurred despite consumer concerns about charging infrastructure, battery life, and resale values. Data is according to the Federation of Automobile Dealers Associations (FADA). Electric vehicles constituted 2.4% of the total 4.07 million vehicles sold, up from 2.1% in 2023. Tata Motors remained the top electric vehicle seller with 61,496 units sold in 2024, compared to 60,100 in 2023. JSW MG Motor saw a 125% increase in sales, selling 21,484 units in 2024 compared to 9,526 the year before. The company attributes this growth to the launch of the Windsor SUV and its battery rental option. Both Tata Motors and JSW MG cut prices in 2024 to stimulate demand.

Ernakulam logistics parks by Adani & Flipkart

The Adani Group is investing Rs 500 crore for a modern logistics park on a 70-acre plot in Kalamassery, Ernakulam district, as announced by Kerala’s industries and law minister. It will have many warehouses to be operated by private firms and Flipkart will be among the first to set up a facility. The Walmart-owned ecommerce firm is expected to get its facility up by December 2025. The Adani Group will also be investing Rs 10,000 crore on phase II of the Vizhinjam deep-water multipurpose port in Kerala over the next three years. The government is holding a two-day Vizhinjam Conclave from January 28 ahead of the Invest Kerala Global Summit scheduled for February 21-22. The government hopes to sign up about 20 investment agreements. The two-day event aims to explore industrial opportunities tied to the port and its ancillary industries, while also seeking investments in various other sectors.

Overseas orders by L&T Construction

Infrastructure major Larsen & Toubro (L&T) on Tuesday said its power transmission and distribution vertical has secured large orders in the domestic and international market. As per L&T’s classification, orders in the range of Rs 2,500 crore to Rs 5,000 crore are considered as ‘large’. The company won an order to implement advanced distribution management system in West Bengal. Among overseas orders, the company has secured contracts for a key substation in Saudi Arabia, designed to facilitate the evacuation of solar generation. In Kuwait, L&T has won a contract for a 400 kV substation. In Dubai it has secured “orders for establishing a set of Extra-High Voltage (EHV) substations which includes a 400/132kV substation.

Key railway projects inaugurated in Telangana, Odisha, J&K

On 6th January, the Prime Minister virtually inaugurated and laid the foundation stone for several significant railway projects aimed at boosting regional connectivity in Telangana, Odisha, and Jammu & Kashmir. In a key initiative to strengthen connectivity, the Prime Minister inaugurated the new Jammu Railway Division, which spans over 742 kilometers and covers critical railway sections such as Pathankot-Jammu-Udhampur-Srinagar-Baramulla, as well as Pathankot-Bhogpur Sirwal and Batala-Pathankot. Additionally, the Prime Minister inaugurated the Charlapalli New Terminal Station located in the Medchal-Malkajgiri district of Telangana.

Rs. 57,000 Crore plan for Kandla Port Expansion

The central government has readied a Rs. 57,000 Crore plan for developing mega ship building facilities, and expanding Gujarat’s Kandla port by 135 million tonnes per annum. The ship building project shall have the capacity to produce 32 new ships or repair 50 old ships every year. The ship building and repair project is estimated to cost around Rs 30,000 crore. Technical capability in the country will be developed to manufacture big VLCC (Very Large Crude Carrier) and similar class of vessels of up to 3,20,000 Tonnes Deadweight tonnage (DWT) capacity. This project will be spread across around 8,000 acres of land and will have components like marina, fishing harbour, townships and marine industrial cluster.

Boosting regional air connectivity a priority

Regional air connectivity will continue to be a priority for the government as air passenger traffic in India is projected to reach 40 crore by 2029. The Regional Air Connectivity (RCS) scheme or UDAN aims to enhance regional air connectivity from unserved and underserved airports as well as make air travel more affordable. Efforts are also on to push operations of helicopters and seaplanes. Under UDAN (Ude Desh ka Aam Nagrik), which was started in October 2016, 613 routes connecting 87 unserved and underserved airports, including 13 heliports and 2 water aerodromes, were operationalized till November 30, 2024. More than 146 lakh domestic passengers have so far travelled through 2.86 lakh RCS flights.

---