India

INDIA

LOCATION, SIZE, AND EXTENT
TOPOGRAPHY
CLIMATE
FLORA AND FAUNA
ENVIRONMENT
POPULATION
MIGRATION
ETHNIC GROUPS
LANGUAGES
RELIGIONS
TRANSPORTATION
HISTORY
GOVERNMENT
POLITICAL PARTIES
LOCAL GOVERNMENT
JUDICIAL SYSTEM
ARMED FORCES
INTERNATIONAL COOPERATION
ECONOMY
INCOME
LABOR
AGRICULTURE
ANIMAL HUSBANDRY
FISHING
FORESTRY
MINING
ENERGY AND POWER
INDUSTRY
SCIENCE AND TECHNOLOGY
DOMESTIC TRADE
FOREIGN TRADE
BALANCE OF PAYMENTS
BANKING AND SECURITIES
INSURANCE
PUBLIC FINANCE
TAXATION
CUSTOMS AND DUTIES
FOREIGN INVESTMENT
ECONOMIC DEVELOPMENT
SOCIAL DEVELOPMENT
HEALTH
HOUSING
EDUCATION
LIBRARIES AND MUSEUMS
MEDIA
ORGANIZATIONS
TOURISM, TRAVEL, AND RECREATION
FAMOUS INDIANS
DEPENDENCIES
BIBLIOGRAPHY

Republic of India

Bharat Ganarajya

CAPITAL: New Delhi

FLAG: The national flag, adopted in 1947, is a tricolor of deep saffron, white, and green horizontal stripes. In the center of the white stripe is a blue wheel representing the wheel (chakra) that appears on the abacus of Asoka's lion capital (c.250 bc) at Sarnath, Uttar Pradesh.

ANTHEM: Jana gana mana (Thou Art the Ruler of the Minds of All People ). A national song of equal status is Vande Mataram (I Bow to Thee, Mother).

MONETARY UNIT: The rupee (r) is a paper currency of 100 paise. There are coins of 5, 10, 20, 25, and 50 paise, and 1, 2, and 5 rupees, and notes of 2, 5, 10, 20, 50, 100, and 500 rupees. r1 = 0.02294 (or $1 = r43.6) as of 2005.

WEIGHTS AND MEASURES: Metric weights and measures, introduced in 1958, replaced the British and local systems. Indian numerical units still in use include the lakh (equal to 100,000) and the crore (equal to 10 million).

HOLIDAYS: Republic Day, 26 January; Independence Day, 15 August; Gandhi Jayanti, 2 October. Annual events—some national, others purely local, and each associated with one or more religious communities—number in the hundreds. The more important include Shivarati in February; and Raksha Bandhan in August. Movable religious holidays include Holi, Ganesh Chaturthi, Durga Puja, Dussehra, 'Id al-Fitr, Dewali; and Christmas, 25 December.

TIME: 5:30 pm = noon GMT.

LOCATION, SIZE, AND EXTENT

The Republic of India, Asia's second-largest country after China, fills the major part of the South Asian subcontinent (which it shares with Pakistan, Nepal, Bhutan, and Bangladesh) and includes the Andaman and Nicobar Islands in the Bay of Bengal and Lakshadweep (formerly the Laccadive, Minicoy, and Amindivi Islands) in the Arabian Sea. The total area is 3,287,590 sq km (1,269,345 sq mi), including 222,236 sq km (85,806 sq mi) belonging to Jammu and Kashmir; of this disputed region, 78,932 sq km (30,476 sq mi) are under the de facto control of Pakistan and 42,735 sq km (16,500 sq mi) are held by China. Comparatively, the area occupied by India is slightly more than one-third the size of the United States. China claims part of Arunachal Pradesh. Continental India extends 3,214 km (1,997 mi) n–s and 2,933 km (1,822 mi) e–w.

India is bordered on the n by the disputed area of Jammu and Kashmir (west of the Karakoram Pass), China, Nepal, and Bhutan; on the e by Myanmar, Bangladesh, and the Bay of Bengal; on the s by the Indian Ocean; on the w by the Arabian Sea; and on the nw by Pakistan. The total boundary length is 21,103 km (13,113 mi), of which 7,000 km (4,340 mi) is coastline.

India's capital city, New Delhi, is located in the north central part of the country.

TOPOGRAPHY

Three major features fill the Indian landscape: the Himalayas and associated ranges, a geologically young mountain belt, folded, faulted, and uplifted, that marks the nation's northern boundary and effectively seals India climatically from other Asian countries; the Peninsula, a huge stable massif of ancient crystalline rock, severely weathered and eroded; and the Ganges-Brahmaputra Lowland, a structural trough between the two rivers, now an alluvial plain carrying some of India's major rivers from the Peninsula and the Himalayas to the sea. These three features, plus a narrow coastal plain along the Arabian Sea and a wider one along the Bay of Bengal, effectively establish five major physical-economic zones in India.

Some of the world's highest peaks are found in the northern mountains: Kanchenjunga (8,598 m/28,208 ft), the third-highest mountain in the world, is on the border between Sikkim and Nepal; Nanda Devi (7,817 m/25,645 ft), Badrinath (7,138 m/23,420 ft), and Dunagiri (7,065 m/23,179 ft) are wholly in India; and Kamet (7,756 m/25,447 ft) is on the border between India and Tibet.

The Peninsula consists of an abrupt 2,400-km (1,500-mi) escarpment, the Western Ghats, facing the Arabian Sea; interior low, rolling hills seldom rising above 610 m (2,000 ft); an interior plateau, the Deccan, a vast lava bed; and peripheral hills on the north, east, and south, which rise to 2,440 m (8,000 ft) in the Nilgiris and Cardamoms of Kerala and Tamil Nadu. The Peninsula holds the bulk of India's mineral wealth, and many of its great rivers—the Narbada, Tapti, Mahanadi, Godavari, Krishna, and Kaveri—flow through it to the sea. The great trench between the Peninsula and the Himalayas is the largest alluvial plain on earth, covering 1,088,000 sq km (420,000 sq mi) and extending without noticeable interruption 3,200 km (2,000 mi) from the Indus Delta (in Pakistan) to the Ganges-Brahmaputra Delta (shared by India and Bangladesh), at an average width of about 320 km (200 mi). Along this plain flow the Ganges, Brahmaputra, Son, Jumna, Chambal, Gogra, and many other major rivers, which provide India with its richest agricultural land.

India is located in a seismically active region prone to destructive earthquakes. On 26 January 2001, a 7.7 magnitude earthquake hit northwest India with tremors felt through most of Pakistan as well. Over 20,000 people were killed and over 166,800 were injured. It was recorded as the deadliest earthquake of the year worldwide. The disastrous tsunami that struck Indonesia on 26 December 2004 also impacted India. The tsunami was caused by an underwater earthquake 324 km (180 mi) south of Indonesia's Sumatra island. More than 100,000 people were affected and there were more than 10,000 casualties. On 8 October 2005, an earthquake measuring 7.6 on the Richter scale, struck the Kashmir region. There were more than 140 aftershocks recorded; many measured 5 in magnitude. More than 1,300 were killed and at least 32,000 homes were destroyed.

CLIMATE

The lower east (Coromandel) and west (Malabar) coasts of the Peninsula and the Ganges Delta are humid tropical; most of the Peninsula and the Ganges-Brahmaputra Lowland are moist subtropical to temperate; and the semiarid steppe and dry desert of the far west are subtropical to temperate. The northern mountains display a zonal stratification from moist subtropical to dry arctic, depending on altitude.

Extremes of weather are even more pronounced than the wide variety of climatic types would indicate. Thus, villages in western Rajasthan, in the Thar (Great Indian) Desert, may experience less than 13 cm (5 in) of rainfall yearly, while 2,400 km (1,500 mi) eastward, in the Khasi Hills of Assam, Cherrapunji averages about 1,143 cm (450 in) yearly. Sections of the Malabar Coast and hill stations in the Himalayas regularly receive 250–760 cm (100–300 in) yearly; many areas of the heavily populated Ganges-Brahmaputra Lowland and the Peninsula receive under 100 cm (40 in).

Winter snowfall is normal for the northern mountains and Kashmir Valley, but for most of India, scorching spring dust storms and severe hailstorms are more common. The northern half of the country is subject to frost from November through February, but by May a temperature as high as 49°c (120°f) in the shade may be recorded. High relative humidity is general from April through September. Extratropical cyclones (similar to hurricanes) often strike the coastal areas between April and June and between September and December.

The monsoon is the predominant feature of India's climate and helps to divide the year into four seasons: rainy, the southwest monsoon, June–September; moist, the retreating monsoon, October–November; dry cool, the northeast monsoon, December–March; hot, April–May. The southwest monsoon brings from the Indian Ocean the moisture on which Indian agriculture relies. Unfortunately, neither the exact times of its annual arrival and departure nor its duration and intensity can be predicted, and variations are great. In 1987, the failure of the southwest monsoon resulted in one of India's worst droughts of the century.

FLORA AND FAUNA

Almost one-fourth of the land is forested. Valuable commercial forests, some of luxuriant tropical growth, are mainly restricted to the eastern Himalayas, the Western Ghats, and the Andaman Islands. Pine, oak, bamboo, juniper, deodar, and sal are important species of the Himalayas; sandalwood, teak, rosewood, mango, and Indian mahogany are found in the southern Peninsula. Some 15,000 varieties of midaltitude, subtropical, and tropical flowers abound in their appropriate climatic zones. The neem tree, a native tropical evergreen tree, has been called the "village pharmacy" because many parts of the tree have been used for a variety of medicines and lotions.

India has over 300 species of mammals, 900 species of breeding birds, and a great diversity of fish and reptiles. Wild mammals, including deer, Indian bison, monkeys, and bears, live in the Himalayan foothills and the hilly section of Assam and the plateau. In the populated areas, many dogs, cows, and monkeys wander as wild or semiwild scavengers.

ENVIRONMENT

Among India's most pressing environmental problems are land damage, water shortages, and air and water pollution. During 1985, deforestation, which, especially in the Himalayan watershed areas, aggravates the danger of flooding, averaged 1,471 sq km (568 sq mi) per year. India also lost 50% of its mangrove area between 1963 and 1977. In 2000, about 21% of the total land area was forested.

Despite three decades of flood-control programs that had already cost an estimated $10 billion, floods in 1980 alone claimed nearly 2,000 lives, killed tens of thousands of cattle, and affected 55 million people on 11.3 million hectares (28 million acres) of land. As of the mid-1990s, 60% of the land where crops could be grown had been damaged by the grazing of the nation's 406 million head of livestock, deforestation, misuse of agricultural chemicals, and salinization.

Due to uncontrolled dumping of chemical and industrial waste, fertilizers and pesticides, 70% of the surface water in India is polluted. The nation has 1,261 cu km of renewable water resources, of which 92% is used for farming. Safe drinking water is available to 96% of urban and 82% of rural dwellers.

Air pollution is most severe in urban centers, but even in rural areas, the burning of wood, charcoal, and dung for fuel, coupled with dust from wind erosion during the dry season, poses a significant problem. Industrial air pollution threatens some of India's architectural treasures, including the Taj Mahal in Agra, part of the exterior of which has been dulled and pitted by airborne acids. In what was probably the worst industrial disaster of all time, a noxious gas leak from a Union Carbide pesticide plant in Bhopal, the capital of Madhya Pradesh, killed more than 1,500 people and injured tens of thousands of others in December 1985. In 1992 India had the world's sixth-highest level of industrial carbon dioxide emissions, which totaled 769 million metric tons, a per capita level of 0.88 metric tons. In 2000, the total carbon dioxide emissions was reported at 1 billion metric tons.

The environmental effects of intensive urbanization are evident in all the major cities, although Calcutta—once a symbol of urban blight—has been freed of cholera, and most of the city now has water purification and sewer services. Analogous improvements have been made in other leading cities under the Central Scheme for Environmental Improvement in Slum Areas, launched in 1972, which provided funds for sewers, community baths and latrines, road paving, and other services.

The National Committee on Environmental Planning and Coordination was established in 1972 to investigate and propose solutions to environmental problems resulting from continued population growth and consequent economic development; in 1980, the Department of the Environment was created. The sixth development plan (1979–84), which for the first time included a section on environmental planning and coordination, gave the planning commission veto power over development projects that might damage the environment; this policy was sustained in the seventh development plan (1985–90). The National Environmental Engineering Research Institute has field center areas throughout the country.

The Wildlife Act of 1972 prohibits killing of and commerce in threatened animals. There are about 20 national parks and more than 200 wildlife sanctuaries, including 5 natural UNESCO World Heritage Sites and 19 Ramsar wetland sites. As of 2003, 5.2% of India's total land area was protected. According to a 2006 report issued by the International Union for Conservation of Nature and Natural Resources (IUCN), threatened species included 85 types of mammals, 79 species of birds, 25 types of reptiles, 66 species of amphibians, 28 species of fish, 2 types of mollusks, 21 species of other invertebrates, and 246 species of plants. Endangered species in India include the liontailed macaque, five species of langur, the Indus dolphin, wolf, Asiatic wild dog, Malabar largespotted civet, clouded leopard, Asiatic lion, Indian tiger, leopard, snow leopard, cheetah, Asian elephant, dugong, wild Asian ass, great Indian rhinoceros, Sumatran rhinoceros, pygmy hog, swamp deer, Himalayan musk deer, Kashmir stag or hangul, Asiatic buffalo, gaur, wild yak, white-winged wood duck, four species of pheasant, the crimson tragopan, Siberian white crane, great Indian bustard, river terrapin, marsh and estuarine crocodiles, gavial, and Indian python. There are at least ten extinct species. Although wardens are authorized to shoot poachers on game reserves, poaching continues, with the Indian rhinoceros (whose horn is renowned for its supposed aphrodisiac qualities) an especially valuable prize.

POPULATION

The population of India reached one billion in March 2001. In 2005 the population was estimated by the United Nations (UN) at 1,103,596,000, which placed it at number 2 (behind China) in population among the 193 nations of the world. In 2005, approximately 4% of the population was over 65 years of age, with another 36% of the population under 15 years of age. There were 105 males for every 100 females in the country. The projected population for the year 2025 was 1,363,000,000. The population density was 336 per sq km (869 per sq mi).

The US Census Bureau expected India's population to surpass China's by 2035. India's population grew rapidly from the 1920s until the 1970s, mostly due to a sharp decline in the death rate because of improvements in health care, nutrition, and sanitation. In 1921, when India's population stood at 251,321,213, the birth rate was 48.1 but the death rate was 47.2; by 1961, when the population reached 439,234,771, the birth rate was still high at 40.8, but the death rate had dropped by more than half to 22.8. The birth rate dropped from 41.1 in 1971 to 30.2 in 1990–91, presumably attributable to an aggressive program of family planning, contraception, and sterilization, but had little immediate impact on the compounded population growth rate, which averaged 2.1% in the 1980s and 1.9% in 1990–95. According to the UN, the annual population rate of change for 2005–10 was expected to be 1.7%. Despite the fact that the population growth rate had been steadily declining for several decades, the government in 2005 continued to seek ways to slow population growth. The government considers the rapid population growth a serious problem, particularly in relation to reducing poverty. The goal of the Indian government is to reach zero population growth by 2050 with a population of 1.3 billion.

The majority of people live in some 555,315 villages with fewer than 10,000 residents each. The UN estimated that just 28% of the population lived in urban areas in 2005, and that urban areas were growing at an annual rate of 2.38%. The capital city, New Delhi, had a population of 14,146,000 in that year. Other large urban areas and their estimated population were Mumbai (formerly Bombay) (18,336,000); Delhi (15,334,000); Calcutta (14,299,000); Chennai (Madras) (6,900,000); Bangalore (6,532,000); Hyderābād (6,145,000); Ahmadābad (5,897,000); Pune (4,485,000); Surat (3,671,000); Kānpur (3,040,000); Jaipur (2,796,000); Lucknow (2,589,000); and Nāgpur (2,359.000).

MIGRATION

The partitioning of the South Asian subcontinent to create India and Pakistan in 1947 produced one of the great mass migrations in human history, involving some 20 million people. Historically, major migratory movements have been to and from Sri Lanka, Malaysia, Myanmar, and Bangladesh. The influx of Muslim refugees (estimated at 280,000 in 1983) from Bangladesh to Assam state since the 1970s has sparked protests among Hindus. Persons of Indian origin domiciled abroad (excluding Pakistan) reside mainly in Sri Lanka, Malaysia, Nepal, Myanmar, South Africa, Mauritius, Trinidad and Tobago, Guyana, Fiji, the United States, and the United Kingdom. Indian minority groups in foreign countries generally do not become assimilated with the local population but live as separate groups, intermarry, and retain their own distinctive culture even after a residence of several generations.

There has been a steady migration within India from rural to urban areas. Linguistic differences limit the degree of interstate migration, as do efforts by some states to limit job opportunities for migrants and to give preference in public employment to longtime local residents. Sri Lankans began arriving in the early 1990s. Since 1992, 54,000 repatriated voluntarily. However, repatriation stopped in 1995 due to violence in Sri Lanka. Some 3,800 people arrived in 1998, and arrivals continued. In 1999 there were around 66,000 Sri Lankan refugees located in 133 camps in the southern state of Tamil Nadu. An estimated 40,000 Sri Lankans live outside the camps. Indian authorities have not requested international assistance for Sri Lankan refugees, and the repatriation of Sri Lankans to their country is voluntary.

In 2000 there were 6,271,000 migrants living in India, including 170,900 refugees. In 2004, India had 162,687 refugees from China, Sri Lanka, and Afghanistan, and 314 asylum seekers from Myanmar and Afghanistan. In 2004, there were also 650,000 internally displaced people in India.

India receives more remittances from migrant workers than any other country, $23 billion in 2004, up from $10 billion in 2001. Most Indian migrants are unskilled workers. However, increasingly skilled health care and information technology workers emigrate, some returning to participate in India's rapid economic growth. In 2004, some 14,341 Indians applied for asylum in 17 countries, nearly 3,000 to Slovakia and over 1,000 each to Austria, South Africa, the United Kingdom, Germany, and Canada. In that same year 5,659 Indians entered the United States as refugees.

In 2005 the net immigration rate was estimated as -0.07 migrants per 1,000 population. The government views the migration levels as satisfactory.

ETHNIC GROUPS

India's ethnic history is extremely complex, and distinct racial divisions between peoples generally cannot be drawn clearly. However, Negroid, Australoid, Mongoloid, and Caucasoid stocks are discernible. The first three are represented mainly by tribal peoples in the southern hills, the plateau, Assam, the Himalayas, and the Andaman Islands. The main Caucasoid elements are the Mediterranean, including groups dominant in much of the north, and the Nordic or IndoAryan, a taller, fairerskinned strain dominant in the northwest. The dark-complexioned Dravidians of the south have a mixture of Mediterranean and Australoid features. In 2000, 72% of the population was IndoAryan, 25% Dravidian, and 3% Mongoloid and other.

LANGUAGES

The 1961 census recorded 1,652 different languages and dialects in India; one state alone, Madhya Pradesh, had 377. There are officially 211 separate, distinct languages, of which Hindi, English, and 15 regional languages are officially recognized by the constitution. There are 24 languages that are each spoken by a million or more persons.

The most important speech group, culturally and numerically, is the IndoAryan branch of the IndoEuropean family, consisting of languages that are derived from Sanskrit. Hindi, spoken as the mother tongue by about 240 million people (30% of the total population), is the principal language in this family. Urdu differs from Hindi in being written in the ArabicFarsi script and containing a large mixture of Arabic and Farsi words. Western Hindi, Eastern Hindi, Bihari, and Pahari are recognized separate Hindi dialects. Other IndoAryan languages include Assamese, Bengali, Gujarati, Kashmiri, Marathi, Oriya, Punjabi, Rajasthani, and Sindhi. Languages of Dravidian stock are dominant in southern India and include Telugu, Tamil, Kannada, and Malayalam. A few tribal languages of eastern India, such as Ho and Santali, fit into the aboriginal Munda family, which predates the Dravidian family on the subcontinent. Smaller groups in Assam and the Himalayas speak languages of MonKhmer and Tibeto-Chinese origin.

English is spoken as the native tongue by an estimated 10–15 million Indians and is widely employed in government, education, science, communications, and industry; it is often a second or third language of the educated classes. Although Hindi in Devanagari script is the official language, English is also recognized for official purposes. According to government policy, Hindi is the national language; for that reason, Hindi instruction in nonHindi areas is being rapidly increased, and large numbers of scientific and other modern words are being added to its vocabulary. However, there has been considerable resistance to the adoption of Hindi in the Dravidian-language areas of southern India, as well as in some of the IndoAryanspeaking areas, especially West Bengal.

The importance of regional languages was well demonstrated in 1956, when the states were reorganized along linguistic boundaries. Thus, multilingual Hyderābād state was abolished by giving its Marathispeaking sections to Mumbai (formerly Bombay, now in Maharashtra), its Telugu sections to Andhra Pradesh, and its Kannada sections to Mysore (now Karnataka). The Malayalamspeaking areas of Madras were united with TravancoreCochin to form a single Malayalam state, Kerala. Madhya Bharat, Bhopal, and Vindhya Pradesh, three small Hindispeaking states, were given to Madhya Pradesh, a large Hindi state, which, at the same time, lost its southern Marathi areas to Mumbai (formerly Bombay) state. Many other boundary changes occurred in this reorganization. Mumbai state originally was to have been divided into Gujarati and Marathi linguistic sections but remained as one state largely because of disagreement over which group was to receive the city of Mumbai (formerly Bombay). In 1960, however, it, too, was split into two states, Gujarat and Maharashtra, on the basis of linguistic boundaries. In 1966, the government of India accepted the demand of the Punjabispeaking people, mainly Sikhs, to divide the bilingual state of Punjab into two unilingual areas, with the Hindispeaking area to be known as Haryana and the Punjabispeaking area to retain the name of Punjab.

India has almost as many forms of script as it has languages. Thus, all of the Dravidian and some of the IndoAryan languages have their own distinctive alphabets, which differ greatly in form and appearance. Some languages, such as Hindi, may be written in either of two different scripts. Konkani, a dialect of the west coast, is written in three different scripts in different geographic areas.

RELIGIONS

India is the cradle of two of the world's great religions, Hinduism and Buddhism. The principal texts of Hinduism—the Rig Veda (Verses of Spiritual Knowledge ), the Upanishads (Ways of Worship ), and the BhagavadGita (Song of the Lord )—were written between 1200 and 100 bc. The teachings of Buddha, who lived during the 6th–5th centuries bc, were first transmitted orally and then systematized for transmission throughout Asia. Jainism, a religion that developed contemporaneously with Buddhism, has largely been confined to India. The Sikh religion began in the 15th century as an attempt to reconcile Muslim and Hindu doctrine, but the Sikhs soon became a warrior sect bitterly opposed to Islam.

An estimated 82% of the population are Hindus. Hindus have an absolute majority in all areas except Nagaland, Jammu, and Kashmir, and the tribal areas of Assam. Sikhs account for about 2% of the population and are concentrated in the state of Punjab, which since 1980 has been the site of violent acts by Sikh activists demanding greater autonomy from the Hindudominated central government. Other religious groups include Muslims (12% of the population, mostly Sunni) and Christians (2.3%). Large Muslim populations are located in Utar Pradesh, Bihar, Maharashtra, West Bengal, Andhra Pradesh, Kerala, Jammu, and Kashmir. The northeastern states of Nagaland, Mizoram, and Meghalaya have Christian majorities. Buddhists, Jains, Parsis (Zoroastrians), Jews, and Baha'is make up less than 2% of the total population.

The caste system is a distinct feature of Hinduism, wherein every person either is born into one of four groups—Brahmans (priests and scholars), Kshatriyas (warriors and rulers), Vaisyas (shopkeepers, artisans, and farmers), and Sudras (farm laborers and menial workers)—or is casteless and thus untouchable. The untouchables are commonly known as Dalits or as Harijan (from the term used by Mahatma Gandhi). Although the constitution outlaws caste distinctions and discrimination, especially those applying to untouchability, progress in changing customs has been slow. Many Dalits have converted to other faiths in order to escape widespread discrimination in some areas; but several states have anticonversion laws in place for Dalits.

Freedom of worship is theoretically assured under the constitution; however, the government has the right to religious organizations that are considered to provoke public disorder. There are also a number of laws in place on both the federal and state level that regulate the activities of religious groups and even the right to religious conversions. There is a great deal of animosity between Muslims and Hindus, as well as Christians and Hindus; violent outbursts between these groups are not uncommon.

TRANSPORTATION

India's railway system is highly developed and constitutes the country's primary means of long-distance domestic transport. In 2004, the Indian railway system consisted of 63,230 km (39,329 mi), of broad and narrow gauge rail lines, of which 16,693 km (10,383 mi) were electrified. Broad gauge lines were the most extensive at 45,718 km (28,437 mi), with three sizes of narrow gauge line accounting for the remainder. Virtually all of India's railways are state-owned, and are the nation's largest public enterprise. It is also the largest railroad system in Asia and the fourth-largest in the world. In October 1984, India's first subway began operation in Calcutta over 3 km (1.9 mi) of track.

The national and state road network in 2002 consisted of about 3,319,644 km (2,064,818 mi), of which 1,517,077 km (942,712 mi) were paved. In 2003, there were 10,694,000 motor vehicles, including 6,669,000 automobiles and 4,025,000 commercial vehicles.

As of 2004, India had about 14,500 km (9,019 mi) of inland waterways, with 5,200 km (3,234 mi) on major rivers and 485 km (302 mi) on canals accessible by motorized vessels. Most important are the Ganges, Brahmaputra, Godavari, and Krishna rivers and the coastal plain canals of Kerala, Chennai, Andhra Pradesh, and Orissa.

In 2005, India's merchant fleet totaled 299 vessels of 1,000 GRT or more, with a combined total of 6,555,507 GRT, sufficient to handle almost all of the country's coastal trade and much of its trade with adjacent countries. The rest of India's trade is handled by foreign ships. Eleven major ports handle the bulk of the import-export traffic; the leading ports are Mumbai (formerly Bombay) and Mormugao. There are 140 smaller ports along the Indian coastline.

In 2004, there were an estimated 333 airports. As of 2005, a total of 239 had paved runways and there were also 27 heliports. International airports are at Mumbai, formerly Bombay (Santa Cruz); Calcutta (Dum Dum); Delhi (Indira Gandhi); Chennai, formerly Madras (Meenambakkam); and Trivandrum. The Indian Airlines Corp., a nationalized industry, operates all internal flights and services to neighboring countries with daily flights to 60 cities. Air-India, also government-owned, operates long-distance services to foreign countries on five continents. A national airline, Vayudoot, was established in 1981 to provide service to otherwise inaccessible areas in the northeast. Private airlines are growing in importance as well. In 2003, about 19.456 million passengers were carried on scheduled domestic and international airline flights.

HISTORY

India is one of the oldest continuously inhabited regions in the world. In Harappa, an area in the Indus Valley (now in Pakistan), between 3000 and 2000 bc, scores of thriving municipalities developed a distinct urban culture. This riverain civilization fell into decay around 1500–1200 bc, probably owing to the arrival of Aryan (Indo-European-speaking) invaders, who began entering the northern part of the subcontinent via Afghanistan. There followed over a thousand years of instability, of petty states and larger kingdoms, as one invading group after another contended for power. During this period, Indian village and family patterns, along with Brahmanism—one form of Hinduism—and its caste system, became established. Among the distinguished oral literature surviving from this period are two anonymous Sanskrit epics, the Ramayana (traditionally attributed to the legendary poet Valmiki) and the Mahabharata (the longest poem in the world, containing over 100,000 verses, including one of Hinduism's more sacred texts, the Bhagavad-Gita ).

The South Asian subcontinent already had a population of about 30 million, of whom approximately 20 million lived in the Ganges Basin, when Alexander the Great invaded the Indus Valley in 326 bc. His successors were absorbed by the new Maurya dynasty (c.321–c.184 bc); under Chandragupta (r. c.321–c.297 bc), from his capital at Pataliputra (now Patna), the Mauryans subdued most of northern India and what is now Bangladesh. His successor, Asoka (r.273–232 bc), put all of India under unified control for the first time; an early convert to Buddhism, his regime was remembered for its sectarian tolerance, as well as for remarkable administrative, legal, and cultural achievements. Many Buddhist monuments and elaborately carved cave temples found at Sarnath, Ajanta, Bodhgaya, and other places in India date from the reigns of Asoka and his Buddhist successors.

In the years following Asoka, India divided again into a patchwork of kingdoms, as other invaders arrived from central and western Asia. In the process, Hinduism prevailed over Buddhism, which found wide acceptance elsewhere in Asia but remained widely practiced in India, its birthplace. Hindu kingdoms began to appear in what is presentday southern India after the 4th century ad. The era of the Gupta dynasty rule (ad 320–c.535) was a golden age of art, literature, and science in India. Hindu princes of the Rajput sub-caste, ruling in the northwest, reached their peak of power from ad 700 to 1000, although their descendants retained much of their influence well into British days.

In the 8th century, the first of several Islamic invaders appeared in the northwest; between 1000 and 1030, Mahmud of Ghaznī made 17 forays into the subcontinent. The first Muslim sultan of Delhi was Kutbuddin (r. c.1195–1210), and Islam gradually spread eastward and southward, reaching its greatest territorial and cultural extent under the Mughal (or Mogul) dynasty. "Mughal" comes from the Farsi word for Mongol, and the earlier Mughals were descendants of the great 14thcentury Mongol conqueror Timur (also known as "Timur the Lame" or Tamerlane), a descendant in turn of Genghis Khan. Much of the population of the subcontinent began converting to Islam during the Mughal period, however, which helped weave Islam into the social fabric of India.

One of the Timurid princes, Babur (r.1526–30), captured Kabul in 1504 and defeated the Sultan of Delhi in 1526, becoming the first of the Mughals to proclaim himself emperor of India. In 1560, Akbar (r.1556–1605), Babur's grandson, extended the dynasty's authority over all of northern India. Akbar also attempted to establish a national state in and it was Akbar who was the first of the Muslim emperors to attempt the establishment alliance with Hindu rajahs (kings). Though illiterate, he was a great patron of art and literature. Among his successors were Shah Jahan and his son Aurangzeb, who left their imprint in massive palaces and mosques, superb fortresses (like the Lahore fort), dazzling mausoleums (like the Taj Mahal at Agra), elaborate formal gardens (like those in Srinagar), and the abandoned city of Fatehpur Sikri (37 km/23 mi w of Agra). Under Aurangzeb (r.1658–1707), who seized his father's throne, the Mughal Empire reached its greatest extent and then began its decline, largely the result of his repressive policies. The Hindu Marathas fought the Mughals and established their own empire in western India.

Vasco da Gama reached India's southwest coast by sea in 1498, and for a century the Portuguese had a monopoly over the Indian sea. Although it continued to hold bits of Indian territory until 1961, Portugal lost its dominant position as early as 1612 when forces controlled by the British East India Company defeated the Portuguese and won concessions from the Mughals. The company, which had been established in 1600, had permanent trading settlements in Chennai (formerly Madras), Mumbai (formerly Bombay), and Calcutta by 1690. Threatened by the French East India Company, which was founded in 1664, the two companies fought each other as part of their nations' struggle for supremacy in Europe and the western hemisphere in the 18th century. They both allied with rival Indian princes and recruited soldiers (sepoys ) locally, but the French and their allies suffered disastrous defeats in 1756 and 1757, against the backdrop of the Seven Years' War (1756–63) raging in Europe. By 1761, France was no longer a power in India. The architect of the British triumph, later known as the founder of British India, was Robert Clive, later Baron, who became governor of the Company's Bengal Presidency in 1764, to be followed by Warren Hastings and Lord Cornwallis in the years before 1800. The Company's rule spread up the Gangetic plain to Oudh and Delhi, and eventually, to western India where the Maratha Confederacy, the alliance of independent Indian states that had succeeded the Mughal Empire there, was reduced to a group of relatively weak principalities owing fealty to the British in 1818.

The British government took direct control of the East India Company's Indian domain during the Sepoy Mutiny (1857–59), a widespread rebellion by Indian soldiers in the company's service, and in 1859, Queen Victoria was proclaimed Empress of India. The succeeding decades were characterized by significant economic and political development, but also by a growing cultural and political gap between Indians and the British. Indian troops were deployed elsewhere in the world by the Crown in defense of British interests but without any recourse of Indian views.

Nationalism and Independence

While the British moved gradually to expand local self-rule along federal lines, British power was increasingly challenged by the rise of indigenous movements challenging its authority. A modern Indian nationalism began to grow as a result of the influence of Western culture and education among the elite, and the formation of such groups as the Arya Samaj and Indian National Congress. Founded as an Anglophile debating society in 1885, the congress grew into a movement leading agitation for greater self-rule in the first 30 years of this century. Under the leadership of Mohandas Karamchand Gandhi (called the Mahatma, or Great Soul) and other nationalist leaders, such as Motilal and Jawaharlal Nehru, congress began to attract mass support in the 1930s with the success of noncooperation campaigns spearheaded by Gandhi and its advocacy of education, cottage industries, self-help, an end to the caste system, and nonviolent struggle. Muslims had also been politicized, beginning with the abortive partition of Bengal during the period 1905–12. And despite the INC leadership's commitment to secularism, as the movement evolved under Gandhi, its leadership style appeared—to Muslims—uniquely Hindu, leading Indian Muslims to look to the protection of their interests in the formation of their own organization, the AllIndia Muslim League.

National and provincial elections in the mid-1930s, coupled with growing unrest throughout India, persuaded many Muslims that the power the majority Hindu population could exercise at the ballot box could leave them as a permanent electoral minority in any single democratic polity that would follow British rule. Sentiment in the Muslim League began to coalesce around the "two nation" theory propounded by the poet Iqbal, who argued that Muslims and Hindus were separate nations and that Muslims required creation of an independent Islamic state for their protection and fulfillment. A prominent attorney, Muhammad Ali Jinnah, led the fight for a separate Muslim state to be known as Pakistan, a goal formally endorsed by the Muslim League in Lahore in 1940.

Mahatma Gandhi, meanwhile, had broadened his demand in 1929 from self-rule to independence in 1929; in the 1930s, his campaigns of nonviolent noncooperation and civil disobedience electrified the countryside. In 1942, with British fortunes at a new low and the Japanese successful everywhere in Asia, Gandhi rejected a British appeal to postpone further talks on Indian self-rule until the end of World War II. Declining to support the British (and Allied) war effort and demanding immediate British withdrawal from India, he launched a "Quit India" campaign. In retaliation, Gandhi and most of India's nationalist leaders were jailed.

The end of World War II and the British Labor Party's victory at the polls in 1945 led to renewed negotiations on independence between Britain and the Hindu and Muslim leaders. Jawaharlal Nehru and the Congress leadership pressed anew for a single, secular nation in which the rights of all would be guarded by constitutional guarantees and democratic practice. But Jinnah and the Muslim League persevered in their campaign for Pakistan. In midAugust 1947, with HinduMuslim tensions rising, British India was divided into the two self-governing dominions of India and Pakistan, the latter created by combining contiguous, Muslimmajority districts in the western and eastern parts of British India, with the former, the new republic of India, consisting of the large remaining land mass in between. Partition resulted in one of the world's largest mass movements of people: Hindus, Muslims, and Sikhs who found themselves on the "wrong" side of new international boundaries sought to cross over. As many as 20 million people moved, and up to 3 million of these were killed as violence erupted along the borders. Gandhi, who opposed the partition and worked unceasingly for HinduMuslim amity, became himself a casualty of heightened communal feeling; he was assassinated by a Hindu extremist five months after Partition.

Kashmiri Dispute

The Partition did not address the more than 500 princely states with which the British Crown had treaty ties. Most princely rulers chose one or the other dominion on grounds of geography, but the state of Jammu and Kashmir, bordering both new nations, had a real option. A Muslimmajority state with a Hindu maharaja, Kashmir opted first for neither but sought protection when invaded in 1948 by tribesmen from Pakistan. Quickly, Indian and Pakistani armed forces were engaged in fighting that cut to the heart of the "two-nation" theory and brought the dispute to the fledgling United Nations. A UN ceasefire in 1949 left the state divided, one-third with Pakistan and the rest, including the Vale of Kashmir, under Indian control. An agreement to hold an impartial plebiscite broke down when the antagonists could not agree on the terms under which it would be held. India and Pakistan went to war again in 1965, and relationships over Kashmir remained tense. A 1971 agreement formed an informal border, known as the Line of Control, which both nations agreed to honor. Both nations have stood by the agreement for the most part, although militant activity in Kashmir since the late 1980s has led to periodic clashes between Indian and Pakistani troops. Such clashes came close to war in 1999 when insurgents that India claimed were backed by Pakistan entered the Indianheld Kargil region in Kashmir. Heavy fighting between Indian and Pakistani troops ensued, until Pakistan withdrew from Kargil that year. On 24 December 1999, Kashmiri militants hijacked an Indian Airlines plane flying between Nepal and Delhi to Afghanistan, an incident India blamed on Pakistan. In July 2002, the United States announced that it did not support Pakistan's persistent demand for a plebiscite in Kashmir, a statement welcome to India.

An upsurge in violence marked the runup to state elections held in Indianadministered JammuKashmir in September–October 2002. More than 800 people were killed in the violence. The elections were fought among proIndia parties, with separatists boycotting the elections. The elections resulted in an upset for the National Conference; it was the first time the party had been voted out of office since independence. The NC won 28 seats out of 87 in the State Assembly. The People's Democratic Party, which firmly stood against human rights abuses in Kashmir, emerged as victor, along with the Congress Party. India had seven million troops amassed on the Line of Control in Kashmir.

Nearly 80,000 people had died in the Indiacontrolled portion of Kashmir as of early 2006.

India and Pakistan declared a formal ceasefire in Kashmir in November 2003, and relations between the two countries were slowly improving. A bus link between the India- and Pakistancontrolled portions was established in April 2005, and both countries cooperated to some degree with the distribution of humanitarian aid following a deadly earthquake that struck the region on 8 October 2005.

In a second border dispute, India and China have been at odds about their Himalayan border since the Chinese occupation of Tibet in 1959, leading to clashes between Indian and Chinese troops at a number of locations along the disputed Himalayan border, including remote areas of Ladakh. In 1962, Chinese troops invaded—then withdrew from—Chinese claimed areas along the border, defeating India's underequipped and badly led forces. The border dispute with China remained unresolved, although tensions have been eased by a standstill accord signed by the two countries in September 1993. An "agree to disagree" stance persisted between the two populationheavy nations until 2005 when talks were initiated to resolve the longstanding dispute.

After Nehru's death on 27 May 1964, his successor, Lal Bahadur Shastri, led India in dealing with an unprecedented round of HinduMuslim violence occasioned by the theft of a holy Islamic relic in Kashmir. In August and September 1965, his government successfully resisted a new effort by Pakistan to resolve the Kashmir dispute by force of arms. India was victorious on the battlefield, and an agreement both nations signed at Tashkent in January 1966, essentially restored the status quo ante. Shastri died of a heart attack at Tashkent, while at the height of his power, and his successor, Indira Gandhi (Nehru's daughter), pledged to honor the accords. India again went to war with Pakistan in December 1971, this time to support East Pakistan in its civil war with West Pakistan; Indian forces tipped the balance in favor of the separatists and led to the creation of Bangladesh from the former East Pakistan; in Kashmir, there were minor territorial adjustments. International tensions were heightened again, however, in April 1974 when India became the first Third World country to conduct a successful test of an atomic bomb.

Weakening of Congress

Domestically, Indira Gandhi consolidated her power. The party lost its accustomed majority in parliament in the 1967 elections, but she continued to govern with the support of other parties and independents, winning again in 1972. In June 1975, after her conviction on minor election law violations in the 1972 polls, which required her to resign, she continued in power by proclaiming a state of emergency. By decree, she imposed press censorship, arrested opposition political leaders, and sponsored legislation that retroactively cleared her of the election law violations. These actions, although later upheld by the Supreme Court, resulted in widespread public disapproval.

Two years later, she held parliamentary elections in which she was defeated, forcing the Congress Party into the parliamentary opposition for the first time. The state of emergency was lifted, and Morarji Desai, formerly Nehru's deputy prime minister and the compromise choice of the winning five-party Janata coalition, became prime minister. But Janata did not last. Formed solely to oppose Indira Gandhi, the Janata coalition had no unity or agreed program, and soon collapsed. Indira Gandhi's newly reorganized Congress Party/I ("I" for Indira) courted Hindu votes to win a huge election victory in January 1980, and she regained office.

Rise of Communal Violence

Indira Gandhi's rule ended with her assassination by her Sikh bodyguards in October 1984. The assassination stemmed from her ordering of troops in 1983 to storm the Golden Temple in Amritsar, where Sikh militants agitating for an independent nation of Khalistan in the Sikhdominant Punjab province were alleged to be storing arms. The Sikh factionalism occurred against a backdrop of communal violence that plagued India in 1983. Hindu mobs in the state of Assam attacked Muslims from Bangladesh and West Bengal, killing at least 3,000 persons. After widespread violence in Punjab, Indira Gandhi had imposed direct rule in the state.

Rajiv Gandhi immediately succeeded his mother as prime minister and, in parliamentary elections held in December 1984, led the CP/I to its largest victory. But during the next two years, Rajiv Gandhi's popularity declined precipitously as the public reacted to government imposed price increases in basic commodities, his inability to stem escalating sectarian violence, and charges of military kickbacks and other scandals. In October 1987, Indian troops were sent to Sri Lanka to enforce an agreement he and the Sri Lankan president had signed in July, aimed at ending the conflict between the country's Sinhalese majority and Tamil minority.

In September 1989, Rajiv agreed with Sri Lanka's request to pull his 100,000 troops out of their bloody standoff with Tamil separatists by the end of the year. In elections later that fall, his Congress/I Party won only a plurality of seats in the Lok Sabha, and he resigned. Vishwanath Pratap Singh, formerly Rajiv's rival in the CP and leader of the secondlargest party (Janata Dal) in the house, formed a government with the support of two other parliamentary groups. Despite an encouraging start, V.P. Singh's government lost first its momentum, then its ability to command a majority in the parliament. He resigned on losing a confidence vote 11 months later and was succeeded, with Congress/I support, by longtime Janata and Congress leader Chandra Shekhar, who resigned after four months.

During the election campaign that followed in the spring of 1991, Rajiv Gandhi was assassinated by a disgruntled Sri Lankan Tamil while in Tamil Nadu. Congress/I rallied around longtime party stalwart P. V. Narasimha Rao, a former minister under both Rajiv and Indira Gandhi, drawing on a sympathy vote, to finish close enough to a majority to form a minority government. As prime minister, Rao—who was also Congress Party president—faced one of the worst outbreaks of HinduMuslim violence since Partition. The violence was focused on a dispute over the Babri Masjid mosque in Ayodhya, Uttar Pradesh. Hindus had claimed that the mosque had been built on the site of a former temple, and a proHindu political party, the Bharathiya Janata Party (BJP) exploited the longsimmering dispute into a carefully orchestrated grab for political power. Hindu militants succeeded in destroying the mosque on 6 December 1992, an act that led to widespread communal riots in Uttar Pradesh, Mumbai (formerly Bombday) and much of the rest of the country. Communal riots have flared up throughout India ever since, and remained a persistent threat to the country's longterm stability. The worst outbreak of communal violence following the 1992 rioting occurred in February and March 2002, a group of Muslims in the town of Godhra in the state of Gujarat attacked and set fire to two train cars carrying Hindu activists returning from Ayodhya. Fifty-eight Hindus were killed in the 27 February attack. Starting the following day, Hindus attacked Muslims in Gujarat, leaving hundreds dead and tens of thousands displaced. In three months of violence, much of it sanctioned by India's Hindu nationalist dominant federal and Gujarati state governments, approximately 2,000 individuals were killed, mostly Muslims.

In more positive developments, Rao initiated economic reforms that, beginning in the early 1990s, opened India to foreign investors and market economics. He lost his hold on power in 1996, and in May of that year, President Shankan Dayal Sharma appointed Hindu nationalist Atal Bihari Vajpayee as prime minister, beginning a whirlwind of power struggles and political instability during which India changed governments four times in 11 months, with power shifting between the BJP and a United Front/Congress coalition. In an effort to retain its traditional grasp of power, Rajiv Gandhi's widow, Sonia Gandhi, was named president of the Congress Party. Her magnetisim did little, however, to boost Congress' fortunes, and the power struggles culminated with Vajpayee's BJPled party forming a government in 1998 after emerging as the largest single party in India's Parliament. The BJP held power until general elections in 2004 dealt it a loss. Power was returned to the Congress Party for the first time in nearly a decade.

Nuclear Politics and World Terrorism

In May 1998, Vajpayee's government surprised the world by exploding several underground nuclear devices. Pakistan responded by holding its own nuclear tests later in the month. The tests brought economic sanctions against both India and Pakistan from the United States and other countries. Tensions eased somewhat in February 1999, however, when Vajpayee inaugurated the first ever bus service between India and Pakistan by traveling to Lahore to meet Pakistan's prime minister. This resulted in the Lahore Declaration (signed 21 February 1999), by which India and Pakistan pledged to resolve their differences peacefully and work for nuclear security. Nevertheless, both countries continued to test mediumrange missiles capable of delivering nuclear warheads on targets throughout the region.

Following the September 2001 terrorist attacks on the United States, the United States lifted sanctions imposed on India following its 1998 nuclear tests, citing India's support in the USled war on terrorism. India began to insist that Pakistan play a larger role in curtailing "crossborder terrorism" in Kashmir and India itself. On 13 December 2001, the Indian Parliament was attacked by five suicide fighters. Fourteen people died in the raid, including the five attackers. India blamed the attacks on two Pakistan-based organizations, LashkareTaiba and JaisheMuhammad, which the United States also listed as terrorist groups. Following the attacks on Parliament, diplomatic contacts were curtailed, rail, bus, and air links were severed, and close to one million troops amassed on India's and Pakistan's shared border, the largest military buildup since the 1971 war. In January 2002, India successfully testfired the Agni, a nuclearcapable ballistic missile, off its eastern coast. In May, Pakistan testfired three mediumrange surface-to-surface Ghauri missiles, capable of carrying nuclear warheads. In June, the United States and the United Kingdom undertook a diplomatic offensive to avert war, and urged their citizens to leave India and Pakistan. In October, India announced its troops had begun withdrawing from Pakistan's border, but Pakistan stated it wanted proof of the pullback before starting its own.

On 19 March 2003, the USled coalition launched war in Iraq. The war was seen as setting a precedent for authorizing preemptive strikes on hostile states. The notion that India and Pakistan might adopt such a policy toward one another caused international concern. In April 2003, spokesmen from both India and Pakistan asserted that the grounds on which the USled coalition attacked Iraq also existed in each other's country. The situation became more uncomfortable in March 2006 when US president George W. Bush, in a visit to India, signed a deal that allowed India to import nuclear fuel and technology, a privilege unlikely to be extended to Pakistan.

GOVERNMENT

India is a sovereign socialist secular democratic republic. Its constitution, which became effective 26 January 1950, provides for a parliamentary form of government, at the center and in the states. The constitution also contains an extensive set of directive principles akin to the US Bill of Rights. Legislative acts and amendments have weakened some of those guarantees, while a number of decisions by the supreme court have left some weakened and others—like the commitment to secularism and to representative government—strengthened. Suffrage is universal at age 18.

The parliament, or legislative branch, consists of the president, the Council of States (Rajya Sabha), and the House of the People (Lok Sabha). The Rajya Sabha has a membership of not more than 250 members, of whom 12 are appointed by the president and the remainder indirectly elected by the state legislatures and by the union territories for six-year terms, with one-third chosen every two years. The Lok Sabha has 543 directly elected members (530 from the states, 13 from the union territories) and two members appointed by the president to represent the AngloIndian community. More than 22% of the seats are reserved for socalled "backward classes," that is, schedule castes (formerly "Untouchables") and scheduled tribes. The Lok Sabha has a maximum life of five years but can be dissolved earlier by the president. The next elections were to take place before May 2009.

The president and vice president are elected for five-year terms by an electoral college made up of the members of both parliamentary houses and the legislative assemblies of the states. Legally, all executive authority, including supreme command of the armed forces, is vested in the president, as head of state, who, in turn, appoints a council of ministers headed by a prime minister. The prime minister serves as the head of government. That individual is chosen by legislators of the political party, or coalition of parties, that commands the confidence of the parliament. The prime minister forms—and the president then appoints—the council of ministers, consisting of cabinet ministers, ministers of state, and deputy ministers to formulate and execute the government program. The vice president serves as president of the Rajya Sabha and usually succeeds the president at the end of the latter's term.

By tradition, the presidency and vice presidency trade off between northerner and southerner, although a Muslim and a Sikh—nonregional identifications—have also held these positions. In July 2002, A.P.J. Abdul Kalam was elected India's 11th president, garnering 90% of the electoral college vote. He was the scientist responsible for carrying out India's nuclear tests in 1998, and is a Muslim. His term was to last through 2007.

Elections at the state level are no longer timed to coincide with national elections, and their schedule has become erratic, as state governments have been more or less stable.

BJP party leader A.B. Vajpayee emerged from the May 1996 election as the new prime minister. In an 11-month period, he was succeeded by Deve Gowda, of the United Front and I.K. Gujral, a coalition candidate representing Congress and the United Front. Vajpayee returned to the prime minister's position in 1999 and, despite a brief loss of power, retained the position until May 2004 when Congress regained power and chose Manmohan Singh to lead the governing coalition. The next election for prime minister was scheduled for May 2009.

POLITICAL PARTIES

India began its independent existence with the Indian National Congress supreme at the center and in all state legislatures. In its various manifestations, it controlled the government for most of the years since independence in 1947 before losing its dominant position with the rise of the Bharathiya Janata Party (BJP) in 1980. Founded in 1885, the Indian National Congress, known after 1947 as the Congress Party, was the most powerful mass movement fighting for independence in British India. It became the ruling party of a free India by reason of its national popularity and because most leaders of the independence movement were among its members, including Indian first prime minister, Jawaharlal Nehru. In its progression from independence movement to ruling party, the CP spawned many offshoots and continued to do so, as often for personal reasons as for matters of party policy. The first to do so was the socialist wing that split off shortly after independence to form a party in its own right, dividing again several times thereafter.

Other major parties at the time of independence included the Communist Party of India (CPI), with its origins in the peasants and workers parties of the past, representing, like them, the communist left. The CPI began the independence period under a cloud because of its Moscowdirected cooperation with the British during World War II. On the right were parties like the Hindu Mahasabha (HMS), doomed to ignominy when one of its kind killed Mahatma Gandhi in 1948. Within the political system, the HMS, nonetheless, reflected a vital Hindu nationalist strain that has seen several party iterations in the years since. It became a force to contend with as the BJP began to gain popularity after bringing together various strains of the Hindu nationalist movement into an "allIndia" coalition party in 1980. By the early 1990s, the BJP has emerged as India's largest opposition party, and led a ruling coalition from 1998 to 2004.

Parties on the left, right, and center have continued to divide or split off over the years, and the number of single state linguistic, sectarian, and regional parties capable of governing only at the state level but available for coalition building at the center has grown significantly.

As of 2006, 19 political parties held seats in the People's Assembly. Leading parties in 2006 were Congress with 145 seats, the BJP with 138 seats, and the Communist Party of India (Marxist) with 43 seats.

LOCAL GOVERNMENT

The Republic of India is a union of states. The specific powers and spheres of influence of these states are set forth in the constitution, with all residual or nonspecified powers in the hands of the central government (the reverse of the US Constitution). The central government has the power to set state boundaries and to create and abolish states. The state governments are similar to the central government in form, with a chief minister and a cabinet responsible to the state legislature, which may be unicameral or bicameral. State governors, usually retired civil servants or politicians, are appointed by the president for a five-year term and act only on the advice of the state cabinet.

The constitution gives the president the power—on the advice of the prime minister—to dissolve a state legislature and dismiss a state government if no party commands the support of a majority or if the state's constitutional machinery is incapable of maintaining order. The Lok Sahba, which must approve each six-month extension of direct rule, acts as the state legislature during its imposition, governing through the governor. Termed as "President's Rule" in the constitution, this power derives from a provision for "Governor's Rule" in the Government of India Act of 1935 and survives in the Pakistan constitution of 1973 in that form. It was invoked for the first time in 1959 by Prime Minister Nehru, and on the advice of Indira Gandhi, who was then Congress Party president; in power herself, she invoked the power repeatedly, often for partisan political purposes and, especially in the early 1980s, in the wake of ethnic/communal violence in Punjab, Assam, and Jammu and Kashmir. Limitations on its partisan use were imposed in a Supreme Court decision in spring 1994.

Under the States Reorganization Act of 1956, there were 14 states and five union territories, organized, where appropriate, on linguistic grounds. Through a gradual process of reorganization and division, two former union territories have become states while new union territories have been created (there were seven as of 2006), and the number of states has grown to 28.

Administratively, the states and union territories are divided into districts, under the control of senior civil servants who are responsible for collecting revenues, maintaining law and order, and setting development priorities. Districts are further divided into subdivisions, and subdivisions into taluks or tehsils. State government and lower levels of representative councils vary in organization and function, but all are based on universal adult suffrage. Large towns are each governed by a corporation headed by a mayor; health, safety, education, and the maintenance of normal city facilities are under its jurisdiction. Smaller towns have municipal boards and committees similar to the corporations but with more limited powers. District boards in rural areas provide for road construction and maintenance, education, and public health. The constitution provides for the organization of village councils (panchayats ), and nearly all the villages have been so organized. The panchayats are elected from among the villagers by all the adult population and have administrative functions and a judicial wing that enables them to handle minor offenses.

In the mid-1990s, there were several campaigns to form new states in India, carving new borders along factional lines in existing states. A promise by former Prime Minister Deve Gowda to create a new state in Uttar Pradesh in 1996 renewed separatist sentiments in several other states.

The Hindu nationalist party (BJP) proposed five new states in 1996, hoping to control their assemblies rather than fight political foes in larger entities. Both proposals ignore potentially chaotic consequences in favor of political gain; existing state boundaries were drawn on language differences, while there appeared to be no motive other than politics for the boundaries suggested by the new proposals. On its return to power in 1998, the BJP government succeeded in drafting bills that created three new states (Chhattisgarh, Uttaranchal, and Jharkhand), but put on hold its plans for making Delhi, presently a Union Territory, a state. Chhattisgarh, Uttaranchal, and Jharkhand became India's three newest states in November 2000, raising the total from 25 to 28.

JUDICIAL SYSTEM

The laws and judicial system of British India were continued after independence with only slight modifications. The supreme court consists of a chief justice and 25 associate judges, appointed by the president, who hold office until age 65. The court's duties include interpreting the constitution, handling all disputes between the central government and a state or between states themselves, and judging appeals from lower courts.

There are 18 high courts, subordinate to but not under the control of, the supreme court. Three have jurisdiction over more than one state. Each state's judicial system is headed by a high court whose judges are appointed by the president and over whom state legislatures have no control. High court judges can serve up to the age of 62. Each state is divided into districts; within each district, a hierarchy of civil courts is responsible to the principal civil courts, presided over by a district judge. The 1973 Code of Criminal Procedure, effective 1 April 1974, provides for the appointment of separate sets of magistrates for the performance of executive and judicial functions within the criminal court system. Executive magistrates are responsible to the state government; judicial magistrates are under the control of the high court in each state.

Different personal laws are administered through the single civil court system. Islamic law (Shariah) governs many noncriminal matters involving Muslims, including family law, inheritance, and divorce. There are strong constitutional safeguards assuring the independence of the judiciary. In 1993–94, the supreme court rendered important judgments imposing limits on the use of the constitutional device known as "President's Rule" by the central government and reaffirming India's secular commitment.

ARMED FORCES

The Indian Armed Forces have a proud tradition, having provided one million soldiers during World War I and two million during World War II for combat in Asia, Africa, the Middle East, and Europe. The armed forces are entirely volunteer and consist of a Strategic Forces Command, the regular army, navy, and air force, a territorial (reserve) army, and 16 different fulltime or reserve special purpose paramilitary units for border, transportation, and internal defense.

In 2005, active armed forces personnel totaled 1,325,000. The Army had 1,100,000 personnel, organized into 6 regional commands, a training command, and 11 corps headquarters, which included 3 armored divisions, 25 mechanized infantry battalions, 4 RAPID, 18 infantry divisions, 10 mountain divisions, 8 independent armored brigades, 8 independent infantry brigades, 2 artillery divisions, 4 air defense brigades, and 3 engineer brigades. The Army's equipment included 3,978 main battle tanks, 190 light tanks, 110 reconnaissance vehicles, over 1,700 armored infantry fighting vehicles, more than 817 armored personnel carriers, and more than 12,675 artillery pieces. The Indian Navy had 55,000 active personnel, including 7,000 personnel in its aviation arm and 1,200 Marines. Major naval units included 19 tactical submarines, 1 aircraft carrier, 8 destroyers, 17 frigates, and 28 corvettes. The naval aviation forces had 34 combat capable aircraft that included 15 fighter ground attack and 17 antisubmarine warfare aircraft. The Air Force had 170,000 personnel and 852 combatcapable aircraft, including 386 fighters and 380 fighter ground attack aircraft. The Air Force also had 60 attack helicopters. There is also a Coast Guard of over 8,000 personnel, with 41 aircraft and 50 patrol vessels.

India's Strategic Forces Command is responsible for the country's strategic missile force which consists of 24 IRBMs and 45 SRBMs. As of 2002, it was suspected that India possessed 60 nuclear weapons and had the capability for producing more.

India's paramilitary forces have 1,293,229 active personnel, which included a 208,422 person Border Security Force (BSF), a Central Industrial Security Force of 94,347, and a Central Reserve Police Force of 229,699, which were under the Ministry of Home Affairs. There was also a State Armed Police force of 450,000.

In 2005, the defense budget totaled $22 billion. India in that same year, supplied personnel to six UN peacekeeping operations.

INTERNATIONAL COOPERATION

India became a charter member of the United Nations on 13 October 1945 and belongs to ESCAP and several nonregional specialized agencies. India is also part of the Asian Development Bank, the African Development Bank, the Colombo Plan, SAARC, G-6, G-15, G-19, G-24, and G-77. India became a founding member of the World Trade Organization (WTO) on 1 January 1995. It is a dialogue partner with the ASEAN and an observer in the OAS. India is a member of the Commonwealth of Nations.

India was a founder of the nonaligned movement and has pursued a formally neutralist foreign policy since independence. Relations with China, hostile during the early 1960s, have been normalized since 1976. India's primary ally among the superpowers had been the former USSR, with which a 20-year treaty of peace, friendship, and cooperation was signed in 1971. India also negotiated a settlement in Sri Lanka's civil unrest in July 1987, sending in troops to enforce the agreement.

Since independence, India has fought three wars with neighboring Pakistan, in 1947–48, 1965, and 1971. On 10 March 1983, India and Pakistan signed a five-year agreement for improving economic and cultural ties, which was viewed as a major step in the normalization of their relations. Tension between India and Pakistan increased again in 1986–87, when both countries conducted military exercises near their common border in the sensitive Punjab region. IndoPakistan relations worsened again in 1990 and in the years immediately following as a consequence of Pakistan's support of Islamic insurgents in Indian Kashmir. In 1998 both countries became nuclear powers, conducting a series of underground nuclear tests. Tensions between them worsened again after an attack on the Indian Lok Sabha in December 2001, and both countries amassed approximately one million troops on their shared border. At the January 2004 SAARC summit in Islāmābād, India and Pakistan agreed to begin a Composite Dialogue addressing major issues, including control in Kashmir.

In environmental cooperation, India is part of the Antarctic Treaty, the Basel Convention, Conventions on Biological Diversity and Whaling, Ramsar, CITES, International Tropical Timber Agreements, the Kyoto Protocol, the Montréal Protocol, MARPOL, the Nuclear Test Ban Treaty, and the UN Conventions on the Law of the Sea, Climate Change, and Desertification. The nation is also part of the South Asia Cooperative Environment Program (SACEP).

ECONOMY

As of 2006, India was the world's twelfth-largest economy, and thirdlargest in Asia behind Japan and China, in nominal terms. Although in current dollars, India's GDP was estimated at $758.9 billion in 2005, in purchasing power parity (PPP) terms—a calculation which takes into account the low price levels for goods and services in India compared to the United States—India's effective GDP equaled $3.718 trillion. Annual per capita income, of course, remained very low—estimated at $693 in nominal terms and $3,395 in PPP terms in 2005—but its twelfth-place rank reflects the country's remarkable record of steady growth: an annual growth average of 6.8% since 1994 with a 10% reduction in the proportion of the population living in poverty. Severe impediments and future challenges remain, however. Nearly two-thirds of the labor force is still employed or underemployed in agriculture, which constitutes 22% of the GDP. Industry contributes about 27% to GDP and employs some 17% of the labor force. Services account for about 23% of the labor force, and for 51% of GDP, up from a 12.8% share in 1980. India's population growth dropped below 2% for the first time in four decades in 2001 (it averaged 1.5% over the 2001–05 period), but the growth rate for the workingage group 15 to 60 years olds continued to accelerate, presenting government policy makers with the need to accelerate job creation. Over 58% of the population is under the age of 20.

India is rich in mineral, forest, and power resources, and its ample reserves of iron ore and coal provide a substantial base for heavy industry. Coal is the principal source for generating electric power although hydroelectric and nuclear installations supply a rising proportion of India's power needs. As well, anticipating a rapid growth in oil consumption in the near future, the government actively promotes oil exploration and development. Since 1997, under its New Exploration and Licensing Policy (NELP), foreign companies have been permitted to participate in upstream oil exploration, long restricted to Indianowned firms.

The Indian economy is a mixture of public and private enterprises. Under a planned development regime since independence, the public sector provided the impetus for industrialization and for absorption of sophisticated technology. Nevertheless, a large proportion of the total manufacturing output continued to be contributed by small, unorganized industries. In recent years, and especially since 1991, the government has placed greater emphasis on private enterprise to stimulate growth and modernization. Reflecting this policy shift, public enterprises accounted for only about 7% of the country's GDP in 1999, down from 23% in the mid-1980s. In December 1999, the government created the Ministry of Disinvestment and announced plans to disinvest in 247 companies owned by the central government down to a 26% share in most companies, excluding only three strategic sectors altogether: railways, defense, and nuclear energy. In all, about $530 million was received from disinvestment in 2000/01. In 2002/03 total receipts from disinvestment were only about 28% ($717 million) of the Ministry's projected target $2.5 billion. Sales included a strategic stake of Videsh Sanchar Nigam Ltd. (VSNL), India's premier international communications and internet service provider (ISP) company to the Tata Group, India's largest conglomerate; a strategic stake in IBP, the national petroleum marketing company, to Indian Oil; a strategic stake in Indian Petrochemical Company Ltd. (IPCL) to the Indian company, Reliance Industries; and a strategic share of Maruti Udyog Ltd. (MUL), India's top car maker, to Suzuki Maintenance Corporation (SMC) of Japan.

Following the proclamation of a state of emergency in June 1975, a 20-point economic reform program was announced. Price regulations were toughened, and a moratorium on rural debts was declared. A new campaign was mounted against tax evaders, currency speculators, smugglers, and hoarders. This program, which lapsed when Indira Gandhi was out of power (1977–80), was revised and incorporated into the sixth five-year plan (1980–85). The reforms were buttressed by a 30-month arrangement under the IMF's Extended Fund Facility (EFF), from 9 November 1981 to 10 May 1984. After the collapse of world oil prices in 1986, India's average annual growth increased to 6.2% on the latter half of the decade. This expansion was accompanied, however, by numerous persistent weaknesses: slow growth in formal sector employment, inefficiency and technological lags in the public sector, and increasing fiscal and balance of payments deficits, which by 1990 had produced double digit inflation. The oil shock accompanying the Persian Gulf War catalyzed an acute balance of payments crisis in early 1991.

Swift stabilization measures taken by the newly elected government, including two stand-by arrangements with the IMF, proved highly successful. By mid-1992, foreign exchange reserves had recovered to a comfortable margin and inflation declined from 13.1% in 1991–92 to 8.6% in 1993–94. Further reforms focused on trade liberalization, privatization, and deregulation helped push GDP growth to an average of 6.5% for the five years 1995 to 1999. Accelerating growth sparked a return of double-digit inflation, reaching 13.1% in 1998/99, but a currency devaluation of almost 12% helped bring inflation down to 3.4% in 1999. Economic growth slowed significantly in 2000/01 to around 4% reflecting both the global economic slowdown and also weak agricultural growth in India. The 2000/01 budget included a 30% increase on defense spending because of conflict with Pakistan, increasing the public debt. The central government's fiscal deficit increased steadily from 1997/98 to 2001/02, from 4.9% of GDP to 6.1% of GDP. In 2001/02, however, growth recovered to around 5.5% largely due to a recovery in agriculture. In the more export-sensitive industrial sector, the growth rate was only 2.7%. In 2002/03 industrial growth recovered to an estimated 6.17%, while services increased 7.1%.

By mid-2005, India's economy was booming. Industrial production had grown at its fastest rate in nine years, by 11.7% over the same period in 2004, including an increase in manufacturing of 12.5%. Exports were up by 19% on 2004, and imports by 30%. Economic growth was averaging 6.5% over the 2001–05 period, with inflation at 4%. The stock market in mid-2005 had risen by more than 50% in one year, and foreign exchange reserves were building. Real GDP growth was forecast at 7.8% in fiscal year 2005/06, but was predicted to fall to 7% in 2006/07 and to 6.5% again in 2007/08. High international oil prices and strong domestic demand were predicted to lead to a significant widening of the merchandise trade deficit over the 2006–08 period, but strong surpluses on services and transfers were forecast to limit the size of the current-account deficit.

Despite its shining economy in 2006, India was suffering a stalling of economic reforms that had laid the basis for its successes. These reforms were begun in 1991 under Finance Minister Manmohan Singh, who by May 2004 had become prime minister. The government, led by the Congress Party, by 2005 had proved unable to pursue additional liberalizing economic reforms, as it relied upon support from a group of Communist parties that opposed many such reforms. In June 2005, those parties forced the government to formally abandon plans to sell stakes in 13 state-owned companies to strategic investors. However, by implementing a large public-works project, the government insisted it was implementing plans to reduce rural poverty, help fix rural infrastructure, and give power and rights to the very poor. In addition to the lost revenue from potential privatizations, with such publicworks plans being envisioned, and the money it would take to fund them, the government faced budgetary concerns.

INCOME

The US Central Intelligence Agency (CIA) reports that in 2005 India's gross domestic product (GDP) was estimated at $3.7 trillion. The CIA defines GDP as the value of all final goods and services produced within a nation in a given year and computed on the basis of purchasing power parity (PPP) rather than value as measured on the basis of the rate of exchange based on current dollars. The per capita GDP was estimated at $3,400. The annual growth rate of GDP was estimated at 7.1%. The average inflation rate in 2005 was 4.4%. It was estimated that agriculture accounted for 20.6% of GDP, industry 28.1%, and services 51.4%.

According to the World Bank, in 2003 remittances from citizens working abroad totaled $17.406 billion or about $16 per capita and accounted for approximately 2.9% of GDP. Foreign aid receipts amounted to $942 million or about $1 per capita and accounted for approximately 0.2% of the gross national income (GNI).

The World Bank reports that in 2003 household consumption in India totaled $384.29 billion or about $363 per capita based on a GDP of $600.6 billion, measured in current dollars rather than PPP. Household consumption includes expenditures of individuals, households, and nongovernmental organizations on goods and services, excluding purchases of dwellings. It was estimated that for the period 1990 to 2003 household consumption grew at an average annual rate of 4.9%. It was estimated that in 2002 about 25% of the population had incomes below the poverty line.

LABOR

In 2005, India's active labor force totaled an estimated 496.4 million. In 1999 (the latest year for which data was available), 60% were employed in agriculture, 17% in industry, and 23% in services. The unemployment rate in 2005 was estimated at 9%.

In 2005, there were an estimated 13 to 15 million organized industrial workers, all belonging to the formal economy, which accounted for about 30 million workers, or less than 10% of the total labor force. Most trade unions are affiliated with political parties. The right to strike is often exercised, but public sector unions are required to give 14 days notice prior to an organized strike. Employers are prohibited from discriminating against union activity, and collective bargaining is practiced.

As of 2005, working hours are limited by law to 49 per week for adults with eight-hour days. Minimum wages are set according to industry and by the various states. By law, earned income also includes a costofliving allowance and an annual bonus. However, these regulations were only applicable to factories and all other establishments covered by the Factories Act. Most workers covered under that law earned more than the minimum, and were subject to bonuses and other benefits. Argricultural workers were subject to separate state mandated minimum wage rates. In addition, some industries, such as apparel and footwear, had no prescibed minimum wage rate. Although factory, mine, and other hazardous indutry employment of children under 14 years of age was prohibited, India had no formal overall minimum age governing child labor. Estimates place the number of child laborers as ranging from 12.7 to 55 million, as of 2005. Many of them work in the hand-knotted carpet industry. Bonded labor was abolished in 1976, but was still prevalent. Estimates of the number of bonded laborers range as high as 40 million. Health and safety standards are not regularly enforced.

AGRICULTURE

In 2003, of the total land area of 297 million hectares (734 million acres), the net sown area was 169 million hectares (420 million acres), or about 57%. The irrigated area totaled 55.8 million hectares (137.9 million acres) in 2003. At least 10 million hectares (24.7 million acres) were redistributed under land reform programs during 1951–79. Agriculture employs about 60% of India's population and contributes about 22% to GDP.

Agricultural production increased at an average annual rate of 2.9% during the 1970s, 3.1% during the 1980s, and 3.8% during 1990–98, mainly as the result of the "green revolution," which has made India basically self-sufficient in grain output through the use of improved hybrid seeds, irrigation, and fertilizers. During 2002–04, crop production was up 0.1% from 1999–2001. Cereal production averaged over 104 million tons per year from 1979 to 1981; in 2003, production totaled 232 million tons. Rice leads all crops and, except in the northwest, is generally grown wherever the conditions are suitable. In 2004, 129 million tons of rice were produced on 42.3 million hectares (104.5 million acres). The combined acreage and production of other cereals, all to a large extent grown for human consumption, considerably exceed those of rice. These include jowar, a rich grain sorghum grown especially in the Deccan; wheat, grown in the northwest; and bajra, another grain sorghum grown in the drier areas of western India and the far south. A wheat crop of 72 million tons was harvested on 26.6 million hectares (65.8 million acres) in 2004. Vegetables, pulses, and oilseeds are the other main food crops. Oilseed production in 2004 included 5.1 million tons of cottonseed and 6.8 million tons of rapeseed.

Nonfood crops are mainly linseed, cotton, jute, and tobacco. The cotton crop in 2004/05 was 19 million bales (170 kg each) and was large enough to both supply the increasing demands of the domestic textile sector and provide export receipts. For centuries, India has been famous for its spices and today is one of the world's largest producers, consumers, and exporters of a wide range of spices. Of the 63 spices grown in the country, black pepper, cardamom, ginger, turmeric, and chilles are the most economically important. Since World War II (1939–45), India has been the world's largest producer of black pepper (51,000 tons in 2004). Pepper production is concentrated in the southern states of Kerlala (65%), Karnataka (20%), and Tamil Nadu (15%).

India was the world's second leading producer (after Brazil) of sugarcane in 2004, with an output of 244.8 million tons. Production of raw sugar amounted to 14.2 million tons in 2004/05, enough to meet over 90% of domestic consumption. Tea, coffee, and rubber plantations contribute significantly to the economy, although they occupy less than 1% of the agricultural land (in hill areas generally unsuited to Indian indigenous agriculture), and are the largest agricultural enterprises in India. Tea, the most important plantation crop, is a large foreign exchange earner, with an export value of $377.7 million in 2004, based on exports of 174,728 tons. Production in 2004 was 850,800 tons, 26% of global production. It is grown mostly in Assam and northern Bengal, but also in southern India. Coffee (275,000 tons in 2004) is produced in southern India, and rubber (762,000 tons in 2004) in Kerala. Leaf tobacco production totaled 598,000 tons in 2004.

Because of the everpresent danger of food shortages, the government tightly controls the grain trade, fixing minimum support and procurement prices and maintaining buffer stocks. The Food Corp. of India, a government enterprise, distributes 12 million tons of food grains annually and is increasing its storage capacity.

ANIMAL HUSBANDRY

The livestock population of India is huge and animals as a whole play an important role in the agricultural economy even though they often receive inadequate nourishment. Slaughter of cattle in India is prohibited in all but a few states since Hindus believe that cows and other animals may contain reincarnated human souls. The slaughter of buffaloes is not as offensive to the religious beliefs of Hindus, and buffaloes are slaughtered for meat.

In 2005 there were an estimated 185 million head of cattle, representing about 6% of the world's total and more than in any other country. There are eight breeds of buffalo, 26 cattle breeds, and numerous crossbreeds. The bovine inventory in 2005 also included 98 million buffalo. Other livestock in 2005 included 120 million goats, 62.5 million sheep, 14.3 million hogs, 635,000 camels, 750,000 asses, 800,000 horses, and 430 million chickens. Bullocks (steers) and water buffalo are important draft animals. Dairy farming has made India self-sufficient in butter and powdered milk. Dairying in India is undertaken on millions of small farms, where one to three milk animals are raised on less than a hectare (2.5 acres), and yields consist of two to three liters of milk daily. To improve milk production, a dairy development program was begun in 1978 to build up the milch herd to 150 million cross-bred cows. Milk output in 2005 from over 35 million dairy cows was estimated at 38.5 million tons, second in the world. India also produced 38.5 million tons of buffalo milk that year. Egg production in 2005 was 2,492,000 tons. The production of cattle and buffalo hides and goat- and sheepskins is a major industry. About 51,400 tons of wool were produced in 2005. Silk production that year amounted to 17,500 tons, second highest after China. Animal dung is also used for fuel and fertilizer.

FISHING

Fishing is an important secondary source of income to some farmers and a primary occupation in small fishing villages. Almost three-fifths of the catch consists of sea fish. The bulk is marketed fresh; of the remainder, more than half is sundried. Fish and fish products account for about 2.5–3% of the total export value. Deepsea fishing is not done on a large scale. Inland fishing is most developed in the deltaic channels of Bengal, an area where fish is an important ingredient of the diet. In recent years, the government has been encouraging ocean fishing through the establishment of processing plants and the introduction of deepsea craft. Fishing harbors have been built along the coasts of the Bay of Bengal and the Arabian Sea. Under the fifth national plan (1974–79), fish farming was encouraged through the creation of Fish Farmers' Development Agencies. Fish production achieved a new high of about 3.7 million tons at the end of the seventh national plan (1986–91).

The total fish catch in 2003 was 5,904,584 tons (sixth in the world), of which capture fishing accounted for 3,658,994 tons and aquacultural sources for 2,215,590 tons. Fish exports, still only a fraction of the potential, have shown a steady gain. In 2003, exports of fish products amounted to over $1.3 billion.

FORESTRY

The major forestlands lie in the foothills of the Himalayas, the hills of Assam state, the northern highlands of the Deccan, the Western Ghats, and the Andaman Islands. Other forestlands are generally scrub and poor secondary growth of restricted commercial potential. India's forests are mostly broadleaved; the most important commercial species are sal (10.9% of forest trees), mixed conifers (8.1%), teak (6.8%), fir (3.2%), chirpine (2.4%), and upland hardwood (2.4%). In 2000 there were 64,113,000 hectares (158,423,000 acres) of forestland, according to a satellite survey. About 40% of the forest area is highly degraded and devoid of wood producing trees.

India's forests have historically suffered tremendous pressure from its large human and animal populations as a source of fuel wood, fodder, and timber. According to the government's national forest policy, 33% of the land area should be covered by forest, but actual forest coverage is just 21.6%. About 138,000 hectares (341,000 acres) were planted annually during the 1980s under afforestation programs. During 1990–2000, the forested area grew by an annual average of 38,000 hectares (94,000 acres). Most forests (98%) are owned by state governments and are reserved or protected for the maintenance of permanent timber and water supplies. The government has prohibited commercial harvesting of trees on public land, except for mature, fallen, or sick trees. In order to help meet the fuel needs of much of the population, harvesting dead and fallen branches is permitted in government forests, but this policy is widely violated. About 94% of the total timber cut in 2004 was burned as fuel.

The total timber cut in 2004 was 322.7 million cu m (11.4 billion cu ft). Production that year included (in million of cubic meters): sawn wood, 11.9; paper and paperboard, 4.1; wood-based panels, 2.1; and wood pulp, 1.7. Other forestry products include bamboos, canes, fibers, flosses, gums and resins, medicinal herbs, tanning barks, and lac. Imports of forest products nearly totaled $1,075 million in 2004, and mainly consisted of newsprint, printing and writing paper, and recovered paper products.

MINING

Well endowed with industrial minerals, India's leading industries in 2003 included steel, cement, mining, and petroleum. Gems and jewelry were leading export commodities to the United States. The minerals industry of India produced more than 80 mineral commodities in the form of ores, metals, industrial minerals, and mineral fuels and is among the world's leading producers of iron ore, bituminous coal, zinc, and bauxite. The country exploited 52 minerals—11 metallic, 38 nonmetallic, and 3 mineral fuels. In 2003, India also produced lead, monazite, selenium, silver, ilmenite, rutile, corundum, garnet, jasper, asbestos, barite (from the Cuddapah District mines, Andhra Pradesh), bromine, hydraulic cement, chalk, clays (including ball clay, diaspore, fireclay, and kaolin), feldspar, fluorspar, agate, zircon, graphite, kyanite, sillimanite, lime, magnesite, nitrogen, phosphate rock, apatite, ocher, mineral and natural pigments, pyrites, salt, soda ash, calcite, dolomite, limestone, quartz, quartzite, sand (including calcareous and silica), slate, talc, pyrophyllite, steatite (soapstone), vermiculite, and wollastonite.

Output of iron ore and concentrate totaled 85 million tons in 2003, up from 80 million tons in 2002. Iron ore reserves, estimated at 11,000 million tons of hematite ore containing at least 55% iron, were among the largest in the world. Principal iron ore output came from the rich fields along the Bihar-Orissa border, close to all major existing iron and steel works. Smaller amounts were mined in the Bababudan Hills of Karnataka and elsewhere. The joint venture Río Tinto Orissa Mining Ltd. studied a new mining project, in the Gandhamardan/Malanjtoli areas of Orissa, that had ore reserves of 800 million tons and could start in 2006, produce 25 million tons per year by its fifth year, and have an eventual capacity of 50 million tons per year.

India's output of bauxite by gross weight was 10,002,000 million tons in 2003, up from 9,647,000 tons in 2002. Bauxite deposits were estimated at 2,300 million tons. The stateowned National Aluminium Co. Ltd. (Nalco), which doubled its mining capacity to 4.8 million tons per year, has been privatized by the government.

Production of zinc concentrates (zinc content) in 2003 was 162,000 metric tons, up from 234,300 metric tons in 2002.

Production of smelted gold in 2003 totaled 3,100 kg, while the output of mined and smelted silver totaled 53,600 kg in that same year. Gold and silver came largely from the Kolar fields of southeastern Karnataka, where the gold mines have reached a depth of more than 3.2 km and contained reserves of 55,000 kg of gold. The Geological Survey of India outlined three new gold resources—in the Dona block, Andhra Pradesh, 4.8 million tons averaging 1.9 grams per ton of gold; in the Banswar district, Rajasthan, 7.1 million tons averaging 2.96 grams per ton of gold; and in the Ghrhar Pahar block, Sidhi district of Madhya Pradesh, 3.3 million tons averaging 1.04 grams per ton of gold. The import duty on gold was reduced to curtail smuggling.

In 2003 diamond production (gem and industrial) totaled 60,000 carats, down from 62,000 carats in 2002. Industrial diamond output in 2003 totaled 44,000 carats, down from 45,000 carats in 2002, while gem diamond output totaled 16,000 and 17,000 carats for 2003 and 2002, respectively.

Content of manganese in mined ore produced was 620,000 tons in 2003. Manganese deposits were estimated at 154 million tons. Manganese was mined in Andhra Pradesh, Karnataka, the Nāgpur section of Maharashtra, northward in Madhya Pradesh, along the Bihar-Orissa border adjoining the iron ore deposits, along the MaharashtraMadhya PradeshRajasthan border, and in central coastal Andhra Pradesh.

Mineral production in 2003 included: 28,400 metric tons of mined copper ore, down from 31,500 metric tons in 2002; 1.8 million tons of gross weight chromite, compared to 1.9 in 2002; 2.3 million metric tons of gypsum; and 1,600 metric tons of crude mica, up from 1,500 metric tons in 2002. The bestquality mica came from Bihar.

There were extensive workable reserves of fluorite, chromite, ilmenite (for titanium), monazite (for thorium), beach sands, magnesite, beryllium, copper, and a variety of other industrial and agricultural minerals. However, India lacked substantial reserves of some nonferrous metals and special steel ingredients.

ENERGY AND POWER

India's proven petroleum reserves and crude refining capacity were estimated at 5.4 billion barrels and at 2.1 million barrels per day, respectively, as of 1 January 2004. Oil production in 2003 was estimated at 819,000 barrels per day, of which crude oil accounted for 660,000 barrels per day. However, in that same year, demand for oil totaled an estimated 2.2 million barrels per day, requiring India to import an estimated net 1.4 million barrels per day, in 2003. While India's future oil consumption is anticipated to reach 2.8 million barrels per day by 2010, the country is looking to expand its domestic production to offset its need to rely upon imports. Oil exploration and production are undertaken in joint ventures between government and private foreign companies. As of October 2004, oil accounted for roughly 30% of India's energy consumption. India's natural gas reserves were estimated at 30.1 trillion cu ft, as of 1 January 2004. In 2002, natural gas production and consumption each totaled an estimated 883 billion cu ft.

India's recoverable coal reserves were estimated in 2001 at total 93 billion short tons. Production and consumption of coal in 2002, was estimated at 393 million short tons and 421 million short tons, respectively.

In 2002, India's electric generating capacity was placed at 122.074 million kW, which included: 91.447 million kW of conventional thermal; 26.260 million kW of hydro; 2.860 million kW of nuclear; and 1.507 million kW for geothermal/other sources. Electric power output in 2002 totaled an estimated 547 billion kWh, of which: 478.213 kWh were generated by conventional thermal sources; 26.260 kWh by hydroelectric sources; 17.760 kWh by nuclear plants; and 4.093 kWh by geothermal/other sources. In 2002, India consumed 525.427 billion kWh of electricity, of which 1.520 billion kWh were imported.

A 380 MW nuclear power station, India's first, was completed with US assistance in 1969 at Tarapur, near Mumbai (formerly Bombay). (The Tarapur plant has long been a center of controversy because of India's alleged failure to observe international safeguards to prevent the diversion of nuclear materials for military purposes.) Another nuclear station, in Rajasthan, began partial operations in the early 1970s, and two more plants were added by the end of the decade. In 1996, India had 10 operating reactors with a combined capacity of 1,695 MW, and four more under construction with a planned capacity of 808 MW. In 1999, the 740 MW initial phase of the Dabhol LNGfired power plant began operation—LNG is liquefied natural gas.

INDUSTRY

Modern industry has advanced fairly rapidly since independence, and the industrial sector now contributes 27% of the GDP. Large modern steel mills and many fertilizer plants, heavy-machinery plants, oil refineries, locomotive and automotive works have been constructed; the metallurgical, chemical, cement, and oilrefining industries have also expanded. Moreover, India has established its role in the high valueadded sectors of the "new economy" sectors of information technology (IT), computer hardware, computer software, media, and entertainment. Yet, though the total product is large, industry absorbs only about 17% of the labor force. Nine states—Maharashtra, West Bengal, Tamil Nadu, Gujarat, Uttar Pradesh, Bihar, Andhra Pradesh, Karnataka, and Madhya Pradesh—together account for most of Indian industry.

Industrial production expanded at an average annual rate of 5–6% between 1970 and 1990. Enforced austerity and demand management measures taken to stabilize rapidly worsening macroeconomic imbalances in 1991–92 slowed growth in the industry sector to 0% for that year. This was followed by a modest recovery to 1.9% growth in 1992–93, though declining to an estimated 1.6% in 1993–94, due to lingering effects of the earlier stabilization measures as well as poorer than expected demand in key export markets. In 1995–96, however, the industrial growth rate jumped 11.7%, led by a 13% increase in manufacturing output, the highest in 25 years. Growth in industrial production was 6.6% in 1997–98, but slowed to 4.1% in 1998/99 primarily due to the effects of the Asian financial crisis, but also in part to international sanctions imposed after its nuclear tests in 1998. A rebound evidenced in 6.6% growth in 1999–2000 was cut short by the global economic slowdown in 2001, and the aftermath of the 11 September 2001 terrorist attacks on the United States, including intensifying regional tensions with Pakistan. Growth in industrial production slowed, to 5.1% in 2000–01 and to 2.7% in 2001–02. As the economy improved by middecade, the industrial production growth rate stood at 7.4% in 2004, and had climbed to 11.7% by June 2005.

Under the planned development regime of past decades, government directives channeled much of the country's resources into public enterprises. Private investment was closely regulated for all industries, discouraging investors from formal entry into the sector. However, industrial policy has shifted towards privatization and deregulation. Since 1991 government licensing requirements have been abolished for all but a few "controlled areas": distillation and brewing of alcoholic drinks, cigars and cigarettes, defense equipment, industrial explosives, hazardous chemicals, and drugs and pharmaceuticals. Under the government disinvestment program announced at the end of 1999, only three sectors remain completely closed to private investment: defense, atomic energy, and railway transport. The oil industry was opened to joint foreign investment in 1997 under the New Exploration and Licensing Policy (NELP). The Ministry of Disinvestment was established in December 1999 to oversee the reduction of government shares in 247 stateowned companies. The first sale, in 2000, was 51% of the Bharat Aluminum Company, Ltd. to Sterlite Ltd. of India. In 2002, managerial control of Maruti Udyog Ltd. (MUL), India's top carmaker, was transferred to Suzuki Maintenance Corporation (SMC) of Japan. Generally, the public sector units (PSUs) for which the government has found buyers in its disinvestment program have not been in the industrial or manufacturing sectors. Instead, the government has taken steps to make their operations more competitive. Credit and capital markets have also been greatly liberalized. Since 1992, all foreign companies have been on par with Indian companies in the area of foreign exchange solvency and on the stock market. With these reforms, private investment in industry is now proceeding at a steady pace, fostering increased competition in most of the mining and manufacturing sectors previously monopolized by parastatals.

Textile production dominates the industrial field, accounting for about 30% of export earnings while adding only 7–8% to imports. The textile industry employs approximately 35 million workers, making it the secondlargest employer in India after agriculture. On a broad level, the textile sector can be divided between the natural fiber segment (cotton, silk, wool, jute, etc.) and the manmade fiber segment (polyester filament yarn, blended yarns, etc.). Cotton accounts for about 60% of both domestic consumption and exports. In terms of operations, since the 1980s decentralized powerlooms have produced an increasingly large share of production as centralized mills have declined. In 1986, there were about 638,000 decentralized powerlooms in operation, and by 2002 these had increased 260% to about 1,662,000. Anticipating the globalization of the textile market in 2004, India's National Textile Policy of 2000 pinpointed the weaving sector as the crucial link in the textile value chain (from fiber to fabric to garment to style) that needed to become more competitive. However, integrated mill operations, which perform spinning, weaving and processing in a central location, have stagnated and declined. Mumbai (formerly Bombay), Ahmadābad, and the provincial cities in southern India lead in cotton milling, which accounts for about 65% of the raw material consumed by the textile industry. Jute milling is localized at Calcutta, center of the jute agricultural area. India is the world's number one jute manufacturer. On average, textile production was growing at about 5% a year by 2000, although in 2001–02, with demand damped by a series of negative events—economic recession in the United States, a global economic slowdown, the 11 September 2001 terrorist attacks on the United States, the attack on India's Parliament on 13 December 2001, and sectarian violence in Gujarat—growth fell to 2.6%, while textile exports fell 9%. However, beginning at the end of 2002 and continuing into the next three years, strong growth was evidenced. Textile exports had increased to $11.7 by 2004, an increase of some 5% over 2003. Estimates were that the textile sector would grow by 15–18% following the end of world textile quotas in 2005.

India is the world's ninthlargest steel producer. Crude steel production reached 32.6 million tons in 2004. India's steel production has more than doubled since 1990. In 2005, India's steel production increased by 16.6% over 2004; with China, India led the global increase in steel production in 2005. The industry consists of seven large integrated mills and about 180 mini steel plants. The metallurgical sector also produced 818,000 tons of aluminum products in 2002. Automobile production, fed by both the steel and aluminum industries, has grown at an annual rates of close to 20% since liberalization in 1993, propelled by low interest rates, the expansion of consumer finance, and strong export demand. About 90% of vehicles produced are economy cars, and 10% are luxury cars and SUVs.

In the field of computers and consumer electronics, production has been boosted by the liberalization of technology and component imports. In consumer durables, production in many cases grew at doubledigit rates in 2001/02 (air conditioners, 25%; microwave ovens, over 20%; color TVs, over 15%; refrigerators, 12%; audio products and DVDs, 10%; washing machines, less than 5%), while computer production was up 36%. Computer software exports have grown as a compound growth rate of some 50% per year. The electronics market in India was worth $11.5 billion in 2004, and was projected to be the fastestgrowing electronics market in several succeeding years. Since 2004, the electronics industry growth rate was surging at close to 30%.

In the petrochemical sector, India has 18 refineries throughout the country with a total refinery capacity of more than two million barrels per day. Sixteen refineries are governmentowned, one is jointly owned, and one, the Reliance Industries refinery at Jamnagar in Gujarat State, is privately owned. Almost half India's refinery capacity has been built since 1998, the government's goal being self-sufficiency in refined petroleum products. India's total refinery capacity should currently be enough to meet domestic demand, but because of operational problems it still has to import diesel fuel.

India's cement industry is the secondlargest in the world, after China, with an installed capacity of some 135 million tons. Exports have been very limited and only to immediate neighbors. In the last decade, the government's portion of cement consumption decreased from 50% to 35% as the domestic housing market has grown. However, government financed infrastructure projects have also helped sparked a growth in construction. In 2001/02, 106.9 million tons of cement were produced, of which 5.14 million tons were exported. Cement production—at a 10% growth rate—was expected to grow to $158.5 million tons by the end of 2006/07.

Like cement, India's food processing industry is oriented mainly toward the domestic market. It is India's fifthlargest industry, with output reaching more than $30 billion. Structurally it consists of about 9000 operational units, accounts for about 6.3% of GDP, 13% of exports, and 18% of industrial employment (about 1.6 million workers).

India's fertilizer industry is the thirdlargest in the world and central to its efforts to increase agricultural productivity. Potassium-based nutrients must all be imported. Since 1992 the government has been gradually decontrolling the price of fertilizers.

SCIENCE AND TECHNOLOGY

In 2000 (the latest year for which data was available), India's total expenditures on research and development (R&D) amounted to $20,782.676 million, or 0.85% of GDP. Allocations are divided among government and industry, with government providing the major share at 74.7%, as of 2000, followed by business at 23% and higher education at 2.4%. In 2002, the value of India's high technology exports totaled $1.788 billion, accounting for 5% of the country's manufactured exports. There has been a marked growth in the training of engineers and technicians. For the period 1990-01, India had an estimated 157 researchers and 115 technicians per million people that were actively engaged in R&D. In 1987–97, science and engineering students accounted for 25% of college and university enrollments.

Among the technological higher schools are the Indian Institute of Science at Bangalore and the Indian Institutes of Technology at Mumbai (formerly Bombay), Delhi, Kānpur, Kharagpur, and Madras. In 1947, there were 620 colleges and universities; by 1996, that number was nearly 7,700. One of the primary science and technology issues facing India is a "brain drain." Over 13,000 Indian students annually seek science and engineering degrees in the United States. Such an exodus may greatly reduce the quality of science and engineering education in India.

There are more than 2,500 national research and development institutions connected with science and technology in India. Principal government agencies engaged in scientific research and technical development are the Ministry of Science and Technology, the Council of Scientific and Industrial Research, the Ministry of Atomic Energy, and the Ministry of Electronics. The Council for Scientific and Industrial Research (founded in 1942) has 39 national laboratories under its umbrella. In March 1981, a cabinet committee, headed by the prime minister, was established to review science and technology programs and to decide future policy.

An importer of nuclear technology since the 1960s, India tested its own underground nuclear device for the first time in 1974 at Pokhran, in Rajasthan. In May 1996, India once again performed nuclear tests, dropping three bombs into 700-footdeep shafts in the desert at Pokhran, with an impact of 80 kilotons. Pakistan responded later the same month with tests of its own. The first Indianbuilt nuclear power plant, with two 235-MW heavy-water reactors, began operating in July 1983, and an experimental fastbreeder reactor was under construction.

The country's largest scientific establishment is the Bhabha Atomic Research Center at Trombay, near Mumbai (formerly Bombay), which has four nuclear research reactors and trains 150 nuclear scientists each year. In the area of space technology, India's first communications satellite, Aryabhata, was launched into orbit by the former USSR on 19 April 1975, and two additional satellites were orbited by Soviet rockets in 1979 and 1981. The Indian Space Research Organization constructed and launched India's first satellitelaunching vehicle, the SLV-3, from its Vikram Sarabhai Space Center at Sriharikota on 18 July 1980; the four-stage, solidfuel rocket put a 35 kg (77 lb) Rohini satellite into nearearth orbit. Indianbuilt telecommunications satellites have been launched into orbit from Cape Canaveral, Florida, by the US National Aeronautics and Space Administration, by the European Space Agency, and from French Guiana. India has established a satellitetracking station at Kavalur, in Tamil Nadu. In 1984, the first IndoSoviet manned mission was completed successfully; in 1985, two Indians were selected for an IndoUS joint shuttle flight. An important international sciences program is the United StatesIndia Fund (USIF), through which scientists and engineers participate in IndoUS joint research projects at 15 institutions in each country. Projects include earthquake, atmospheric, marine, energy, environment, medical, and life sciences.

Major learned societies in the country are the Indian Academy of Sciences (founded in 1934 in Bangalore), the Indian National Science Academy (founded in 1935 in New Delhi), and the National Academy of Sciences (founded in 1930 in Allahābād).

DOMESTIC TRADE

Under a nationwide scheme launched in 1979 for the distribution of essential commodities, goods are procured by the central government and then supplied to citizens. Each state has its own consumer cooperative federation; all of these groups are under the aegis of the National Cooperative Consumers Federation with the Minister of Consumer Affairs and Public Distribution. By 2000, more than 26,000 cooperatives and 680 wholesale stores shared in the distribution of sugar, edible oils, and grains in rural areas.

With the government's new emphasis on growth in private enterprise since the late 1980s, the expansion of privately-owned retail outlets have competed with the cooperative sector. Most private commercial enterprises are small establishments owned and operated by a single person or a single family; retail outlets are often highly specialized in product and usually very small in quarters and total stock. Often the Indian retail shop is large enough to hold only the proprietor and a small selection of stock; shutters fronting the store are opened to allow customers to negotiate from the street or sidewalk. There are no major national chains but foreign franchises do exist. In most retail shops, fixed prices are rare and bargaining is the accepted means of purchase. Some department stores and supermarkets have begun to appear in shopping centers in major cities. These shopping centers usually offer entertainment and leisure activities as well.

India's domestic trade is widely influenced by informal and unreported commerce and income, known as "black money."

Country	Exports	Imports	Balance
World	63,028.9	77,201.4	-14,172.5
United States	11,374.8	4,974.9	6,399.9
United Arab Emirates	5,038.7	2,035.1	3,003.6
China, Hong Kong SAR	3,221.4	1,474.8	1,746.6
United Kingdom	2,986.8	3,195.5	-208.7
China	2,918.5	4,004.5	-1,086.0
Germany	2,513.1	2,883.5	-370.4
Singapore	2,098.5	2,060.3	38.2
Belgium	1,783.4	3,928.1	-2,144.7
Bangladesh	1,719.2	…	1,719.2
Italy-San Marino-Holy See	1,708.0	1,058.2	649.8
(…) data not available or not significant.

Government and business hours are generally from 10 am to 5 pm, Monday through Friday, with a lunch break from 1 to 2 pm. Larger shops in Delhi are open from 9:30 am to 1:30 pm and from 3:30 to 7:30 pm. Normal banking hours are from 10 am to 4 pm on weekdays and from 10 am to noon on Saturdays.

FOREIGN TRADE

Initially, India's foreign trade followed a pattern common to all underdeveloped countries: exporting raw materials and food in exchange for manufactured goods. The only difference in India's case was that it also exported processed textiles, yarn, and jute goods. Until the late 1980s, the government's strongly import substitution-oriented industrial policy limited the significance of exports for the Indian economy, and while exports have become more important, they remain only about 8% of national income. With imports exceeding exports almost continuously in the 1970s and 1980s, India registers a chronic trade deficit. Stabilization and structural adjustment measures taken in 1991, including a 50% currency devaluation, have improved the country's balance of trade position by depressing imports and making exports more competitive in the world market. Given the country's relatively well-developed manufacturing base, items like textile goods, gems and jewelry, engineering goods, chemicals, and leather manufactures now comprise the country's leading exported items, replacing jute, tea, and other food products that dominated its export base in the 1960s and early 1970s. India's major imports include petroleum and petroleum products, gold and precious stones, machinery, chemicals, and fertilizers.

India's trade deficit rose to an estimated $19.2 billion in 2004 in balanceofpayments terms, up from $8.9 billion in 2003. Exports performed strongly, rising 31.3% to $78 billion, but imports also soared by 42% to $97 billion, owing largely to the higher price of oil and to the demand for industrial inputs and consumer goods. The United States remained India's largest trading partner, although China in recent years has become the secondlargest market for Indian goods. In 2004, India's leading markets were: the United States (19.8% of all exports); China (8.3%); the United Arab Emirates (8%); the United Kingdom (5.1%); and Hong Kong (4.6%). Leading suppliers include: the United States (6.9% of all imports); China (6%); BelgiumLuxembourg (6%); Singapore (4.7%); and Australia (4.5%).

In percentage terms, India's primary exports in 2004/05 were: engineering goods (20.1% of all exports); gems and jewelry (17.5%); and textiles and garments (16.3%). Major imports were: petroleum and petroleum products (30.4% of all imports); capital goods (10%); and electronic goods (9.3%).

BALANCE OF PAYMENTS

India has in the past had a chronic deficit on current accounts. What has bridged the gap between payments and receipts is mainly external aid (especially nonproject assistance), tourism earnings, and remittances from Indians working abroad. Heavy imports of food grains and armament purchases caused a decline in India's foreign exchange reserves in the mid-1960s. An economic recovery from 1968–69, however, eased the problem, and by September 1970, foreign exchange reserves amounted to $616 million, as compared with $383 million by December 1965. Reserves declined to $566 million by the end of 1972 but increased to $841

Current Account			5,815.0
Balance on goods		-12,041.0
Imports	-62,742.0
Exports	50,701.0
Balance on services		6,790.0
Balance on income		-3,564.0
Current transfers		14,630.0
Capital Account			2,563.0
Financial Account			11,054.0
Direct investment abroad		-488.0
Direct investment in India		3,700.0
Portfolio investment assets		-42.0
Portfolio investment liabilities		1,064.0
Financial derivatives		…
Other investment assets		4,780.0
Other investment liabilities		2,040.0
Net Errors and Omissions			-585.0
Reserves and Related Items			-18,848.0
(…) data not available or not significant.

million as of December 1975, despite massive deficits on current accounts, attributable to the quadrupling of oil import prices during 1973–74. Foreign exchange reserves declined from $6,739 million at the end of 1979 to $3,476 million as of November 1982 but subsequently rose to $5,924 million by March 1987.

The Persian Gulf War crisis worsened the ratio of current account deficit to GDP. Foreign exchange reserves plummeted because of export losses in Kuwait, Iraq, and other nations. Remittances from Indian workers fell, and sudden price increases for oil imports caused an estimated loss to India of over $2.8 billion in earnings. By November 1993, however, India's foreign exchange reserves had risen to $8.1 billion, the highest level since 1951. A substantial reduction in the trade deficit, increased inflows from foreign institutional investors, a stable exchange rate, and improved remittances all contributed in the recovery of reserves. Although export growth remained strong, the current account deficit tripled from 1993–94 to 1995–96. The increase was attributed to a continuing surge in imports and higher debt service requirements. However, between 1995 and 1998 the current account deficit shrank to about 1% of GDP due to increased textile exports and a liberalizing trade regime. India's total external debt in 2001 was estimated at $100.6 billion, and at $117.2 billion in 2004. High international oil prices and strong domestic demand were forecast to lead to a significant widening of the merchandise trade deficit over the period 2006–08, but strong surpluses on services and transfers (remittances) were expected to counteract a deficit in the currentaccount. For the year ending in March 2005, India was expected to enjoy a currentaccount surplus of some $5 billion, compared with $8.7 billion in 2004. Thus, India would have had four consecutive currentaccount surpluses for the first time in 23 years. In the early 2000s, India's exports to East and Southeast Asia increased, including to Japan and South Korea. High growth rates were registered for textiles, chemicals and related products, engineering goods, and leather and manufactures.

BANKING AND SECURITIES

A well-established banking system exists in India as a result of British colonialism. The Reserve Bank of India, founded in 1935 and nationalized in 1949, is the central banking and noteissuing authority. The Reserve Bank funds the Deposit Insurance and Credit Guarantee Corporation, which provides deposit insurance coverage to the banking sector. The largest publicsector bank is the State Bank of India, which, at the end of 1996, accounted for one-third of income. Banks operating in the public sector account for 75% of commercial banking, while private banks take 15% of the market and foreign banks account for the remaining 10%. In 1997, 58% of commercial banks operated regionally, extending credit to small borrowers in rural areas. Scheduled banks maintain branches, mainly in the major commercial and industrial centers of Maharashtra, West Bengal, Uttar Pradesh, and Tamil Nadu states and the Delhi territory. Over 100 branches of Indian commercial banks operate overseas as well, primarily in the United Kingdom, United States, Fiji, Mauritius, Hong Kong, and Singapore. As of July 2000, there were 45 foreign banks in India with 180 branches, as well as 26 foreign representative offices. Total deposits in commercial banks reached $206 billion in 2000-01.

The cost of borrowing remained very high, because of bad debts and nonperforming assets. Most Indian banks lend approximately 30–40% of their capital to the government of India, and over 80% of investment is in government securities. In an attempt to regulate lending practices and interest rates, the government encouraged the formation of cooperative credit societies. Longterm credit is provided by the cooperative land development banks. Nonagricultural credit societies and employees' credit societies supply urban credit. A process of gradual liberalization is being applied to government institutions that supply most medium- and longterm credit. These termlending institutions also control about 30% of all share capital and act as a channel for most foreign borrowing by the private sector. The main bodies are the Industrial Development Bank of India (IDBI), the Industrial Finance Corporation of India (IFCI), the Industrial Credit and Investment Corp. of India (ICIC), and the ExportImport Bank of India (Eximbank). The International Monetary Fund reports that in 2001, currency and demand deposits—an aggregate commonly known as M1—were equal to $81.6 billion. In that same year, M2—an aggregate equal to M1 plus savings deposits, small time deposits, and money market mutual funds—was $283.4 billion. The discount rate, the interest rate at which the central bank lends to financial institutions in the short term, was 6.5%.

The main stock exchanges are located in Calcutta, Mumbai (formerly Bombay), and Madras, and there are secondary exchanges in Ahmadābad, Delhi, Kānpur, Nāgpur, and other cities. The Securities and Exchange Board of India supplies regulation of the stock market. These regulations are not strict, and at times margin trading and other questionable practices have tended to produce wild speculation. Rules favor exchange members rather than public protection or benefit. Brokerage and jobbing are commonly combined. Of India's 21 stock exchanges, the Mumbai Stock Exchange (BSE) and National Stock Exchange (NSE) are the most important. There were 4,730 companies listed on the BSE as of 2004. Total market capitalization on the BSE's listed companies that year totaled was $387.851 billion in that same year. The NSE, however, is perceived as more transparent, has faster trading cycles, more timely settlements, and is in the process of setting up a share depository. Major efforts have been made to strengthen the stock market institutionally and make it less like a casino.

In 1996–97 negative market sentiment, particularly among foreign institutional investors, took the overall price earnings ratio down from 19.6 in June 1996 to 11.3 in November. In the two years ending October 1996, all but 436 of the 2,531 mosttraded shares lost over half their value; more than 1,000 lost over 80% of their value. The market continued to lose ground in 1997 and 1998 due to the Asian financial crisis. In 1999–2000, though, both the BSE and the NSE gained approximately 40% in market share value due to the growth in information technology (IT) stocks. Between 1998 and 1999 alone, the local S&P CNX Index grew 97.8%, but then dropped about 23–24% in each of the next two years. The S&P IFCG and IFCI Indexes also dropped about 20–30% in 1999 and 2000. In 2004, the S&P CNX 500 rose 17.9% from the previous year to 1,804.9.

INSURANCE

The life insurance business was formally nationalized on 1 September 1956 by the establishment of the Life Insurance Corp. of India (LIC), which absorbed the life insurance business of 245 Indian and foreign companies. LIC also transacts business in certain African and Asian countries where there are large Indian populations. The general insurance business was nationalized as of 1 January 1973 and all nationalized general insurance companies were merged into the General Insurance Corp. (GIC) of India. GIC serves as the parent company for the four operating insurers, the New India Assurance Company, the Oriental Fire and General Insurance Company, the National Insurance Company, and the United India Insurance Company.

In 1997, despite repeated promises to allow private insurers into the industry, an announcement on privatization in the financial services sector was postponed in the face of institutional resistance. The unions and leftwing parties led a struggle to stop an opening up of the insurance sector. They were alarmed by government plans to introduce legislation that would set up an independent Insurance Regulatory and Development Authority (IRA). Under the Insurance Regulatory and Development Authority Act of 1999, the IRA finally gained the power to issue licenses to private insurance companies in 2000 to Indians and foreigners. In India, thirdparty auto liablity, public liability for hazardous material handling, workers' compensation, and thirdparty liability for inland water vessels are all compulsory. In 2003, the value of direct premiums written totaled $17.302 billion, of which life premiums accounted for $13.590 billion. India's top nonlife insurer in 2003 was New India, with gross written nonlife premiums of $806.7 million. The nation's leading life insurer that same year was LIC, with gross written life premiums totaling $13,939.1 million.

PUBLIC FINANCE

The government's financial year extends from 1 April to 31 March, and the budget is presented to the parliament on the last day of February. The executive branch has considerable control over public finance. Thus, while parliament can oversee and investigate public expenditures and may reduce the budget, it cannot expand the budget, and checks exist that prevent it from delaying passage. Budgets in recent decades have reflected the needs of rapid

Revenue and Grants	3,222.3	100.0%
Tax revenue	2,515.3	78.1%
Social contributions	11.7	0.4%
Grants	14.6	0.5%
Other revenue	680.7	21.1%
Expenditures	4,560	100.0%
General public services	2,768	60.7%
Defense	652	14.3%
Public order and safety	…	…
Economic affairs	771.6	16.9%
Environmental protection	…	…
Housing and community amenities	192.3	4.2%
Health	74.2	1.6%
Recreational, culture, and religion	…	…
Education	102	2.2%
Social protection	…	0.0%
(…) data not available or not significant.

economic development under rising expenditures of the five-year plans. Insufficient government receipts for financing this development have led to yearly deficits and a resulting increase of new tax measures and deficit financing. The Gulf crisis, increased interest payments, subsidies, and relief in 1991 caused the central government's fiscal deficit to reach 9% of GDP. It fell to 5.7% in 1992–93 but rose to 7.3% of GDP in 1993–94. Principal sources of government revenue are customs and excise duties and individual and corporate income taxes. Major items of expenditure are defense, grants to states and territories, interest payments on the national debt, and economic, social, and community services. High interest rates, 8% inflation, slow industrial growth, and weak foreign investment prompted the government to recommend dramatic new initiatives in the 1997–98 budget, including cuts in taxes and duties. The proposed budget projected a 15% increase in expenditures to $65 billion and a reduction in the deficit to 4.5% of GDP. While expenditures were cut, the budget deficit actually grew in 1997–98 to about 8.5% of the GDP due to currency devaluation and the Asian financial crisis. The budget for 2000 included a 30% increase on defense spending due to the Pakistani conflict. Although applauded by the business community as market-friendly, some observers were chagrined by the 2000 budget's failure to squarely tackle infrastructure reforms. India suffers from inadequate roads and ports, a substandard educational system, and unreliable power supplies.

The US Central Intelligence Agency (CIA) estimated that in 2005 India's central government took in revenues of approximately $111.2 billion and had expenditures of $135.8 billion. Revenues minus expenditures totaled approximately -$24.6 billion. Public debt in 2005 amounted to 82% of GDP (federal and state debt combined). Total external debt was $119.7 billion.

The International Monetary Fund (IMF) reported that in 2003, the most recent year for which it had data, central government revenues were r3,222.3 billion and expenditures were r4,560 billion. The value of revenues was us$69 million and expenditures us$98 million, based on a market exchange rate for 2003 of us$1 = r46.583 as reported by the IMF. Government outlays by function were as follows: general public services, 60.7%; defense, 14.3%; economic affairs, 16.9%; housing and community amenities, 4.2%; health, 1.6%; and education, 2.2%.

TAXATION

Taxes are levied by the central government, the state governments, and the various municipal governments. The sources of central government tax revenue are union excise duties, the central valueadded tax or CENVAT, corporate and personal income (nonagricultural) taxes, wealth taxes, and customs duties. The gift tax was abolished in January 1998. State government sources, in general order of importance, are land taxes, sales taxes, excise duties, and registration and stamp duties. The states also share in central government income tax revenues and union excise duties; and they receive all revenues from the wealth tax on agricultural property. Municipal governments levy land and other property taxes and license fees. Many also impose duties on goods entering the municipal limits. There is little uniformity in types or rates of state and municipal taxes.

Corporate income tax for domestic companies as of 2005 is 35% plus a 2.5% surcharge, and for foreign companies 40% plus a 2.5% surcharge.

The wealth tax is 1% of wealth exceeding r1,500,000 ($31,000). Interest income is taxed at 20% to both foreign and resident companies; capital gains and rental income are taxed at 20% and winnings from lotteries and horse races at 30%. There is no tax on dividends.

The central government imposes a 12.5% valueadded tax (VAT) called the CENVAT. However, lower rates of 4%, 1% and 0% are also levied on domestically manufactured goods.

For the 2003/04 Union Budget, the excise structure was rationalized into four tiers: exempt items many of which had carried 4% rates (like umbrellas, band-aids, toys, corrective glasses, CDs); 8% (like pressure cookers, buckets, dental chairs); 16% (the standard VAT rate applied to most items), and 24% reduced from 20% to 50% on polyester filament yarn, motor cars, utility vehicles, and replacement tires. Special Excise Duties of 32% are applied to aerated soft drinks and concentrates, pan masala, and chewing tobacco.

As of 1 April 2003, instead of being 100% tax free, profits and gains derived from Software Technology Parks of India (STPIs) and export oriented units (EOUs) will only be 90% tax-free.

CUSTOMS AND DUTIES

The majority of imports and some exports are subject to tariffs. There are both revenue and protective tariffs, although the former are more important and have long been a major source of central government income. The Indian government has been steadily reducing tariff rates in order to increase trade and investment. A 35% tariff ceiling was set in the 2001–02 budget. However, India's tariffs are still among the highest in the world. Additional, special duties can more than double the barriers to importing a product, including textiles and apparel. Gold is taxed at an added rate of 9% at the state level and at least an added 3% at the local level. Indians spend more money on gold than anything but oil. India's 28 states also impose duties on products coming in from other states.

FOREIGN INVESTMENT

Until recently, foreign investment remained closely regulated. Rules and incentives directed the flow of foreign capital mainly toward consumer industries and light engineering, with major capitalintensive projects reserved for the public sector. Under the Foreign Exchange Regulation Act of 1973, which went into effect on 1 January 1974, all branches of foreign companies in which nonresident interest exceeded 40% were required to reapply for permission to carry on business; most companies had reduced their holdings to no more than 40% by 1 January 1976. Certain key export-oriented or technology-intensive industries were permitted to maintain up to 100% nonresident ownership. Tea plantations were also exempted from the 40% requirement. Although the government officially welcomed private foreign investment, collaboration and royalty arrangements were tightly controlled. Due to the restrictiveness of these policies, foreign investment remained remarkably low during the 1980s, ranging between $200 and $400 million a year.

Government reform measures in mid-1991 changed this picture significantly. Under the New Industrial Policy, the amount of money invested in the country doubled annually from 1991 to 1995. In 1997 the New Exploration and Licensing Policy (NELP) was announced, permitting the participation of foreign oil companies in upstream exploration and development of oil and gas resources. Effective 1 April 2001, imports of crude oil and petroleum products were liberalized, with staterun enterprises losing their exclusive right to import certain petroleum products for domestic consumption. Also in 2001, India removed quantitative restrictions (QRs) from 715 items (147 agricultural products, 342 textile items, and 226 manufactured goods, including automobiles) in compliance with WTO standards. Under the New Industrial Policy as amended, most sectors have been opened for 100% foreign investment. Sectors such as banking, telecommunications, and print media are still restricted. In some restricted sectors, foreign investment up to 49% or 74% is allowed in the equity of an Indian joint venture company. In the early 2000s, the requirement prior approval by the Reserve Bank of India was removed from enterprises falling within categories allowing 100% foreign investment.

India has eight export processing zones (EPZs) designed to provide internationally competitive infrastructure and duty-free, lowcost facilities for exporters. Foreign investors in some industries can operate in EPZs, export oriented units (EOUs), special economic zones (SEZs) and Software Technology Parks of India (STPIs). SEZs are regarded as foreign territory for purposes of duties and taxes and sector caps that limit foreign direct investment (FDI) in different industries do not apply in the SEZs. In any case, the corporate tax rate on foreign companies has been reduced to 48% to 40%, and the peak customs rate was reduced from 35% to 30%. In November 1999 the government announced its intention to disinvest in 247 stateowned enterprise to the general level of 26% ownership, and established the Ministry of Disinvestment. Although the program has involved the transfer of significant amounts of equity and management control from the government to private sector, it has yet to generate appreciable foreign investment. Despite the trend towards liberalization, India's foreign investment regime remains complex and relatively restricted. Although FDI has increased, average a net $2.64 billion per year 1997/98 to 2001/02, the inflow is still small compared to China, the most relevant comparison, where FDI has run some $30 billion to $40 billion a year. The net flow dropped to $1.8 billion in 2000/01, and then recovered to a net $3.4 billion in 2001/02. FDI inflow amounted to $3.33 billion in 2004. Investment was heaviest in the transportation sector.

Statistics on FDI for India show Mauritius as consistently one of the largest sources, averaging about $700 million per year from 1995 to 2000, with the United States in second place, averaging about $383 million a year. In 2004, the Netherlands was India's largest investor, at $434 million, followed by Mauritius ($420 million) and the United States ($342 million). However, most of the investments credited to Mauritius are actually from American companies seeking to take advantage of its lower withholding taxes or exemptions on payments of royalties, dividends, technical service fees, interest on loans and capital gain by Indian joint venture companies under the terms of the Double Tax Agreement (DTA) between India and Mauritius. Foreign investment through the stock market is limited to 30–40%.

ECONOMIC DEVELOPMENT

Under a series of five-year plans through 2000, the government became a participant in many industrial fields and increased its regulation of existing private commerce and industry. Long the owneroperator of most railway facilities, all radio broadcasting, post, and telegraph facilities, arms and ammunition factories, and river development programs, the government reserved for itself the right to nationalize any industries it deemed necessary. Yet the government's socialist approach was pragmatic, not doctrinaire; agriculture and large segments of trade, finance, and industry remained in private hands. Planning is supervised by an eight-member planning commission, established in 1950 and chaired by the prime minister.

India's first four five-year plans entailed a total public sector outlay of r314.1 billion. The first plan (1951–56) accorded top priority to agriculture, especially irrigation and power projects. The second plan (1956–61) was designed to implement the new industrial policy and to achieve a "socialist pattern of society." The plan stressed rapid industrialization, a 25% increase in national income (in fact, the achieved increase was only 20%), and reduction of inequalities in wealth and income. The focus of the third plan (1961–66) was industrialization, with 24.6% spent on transportation and communications and 20.1% on industry and minerals. Drought, inflation, and war with Pakistan made this plan a major disappointment; although considerable industrial diversification was achieved and national income rose, per capita income did not increase (because of population growth), and harvests were disastrously low. Because of the unsettled domestic situation, the fourth five-year plan did not take effect until 1969. The 1969–74 plan sought to control fluctuations in agricultural output and to promote equality and social justice. Agriculture and allied sectors received 16.9%, more than in any previous plan, while industry and minerals received 18.5%, transportation and communications 18.4%, and power development 17.8%, also more than in any previous plan.

The fifth plan (1974–79) aimed at the removal of poverty and the attainment of self-reliance. A total outlay of r393.2 billion was allocated (26% less than originally envisaged), and actual expenditures totaled r394.2 billion. Once again, the emphasis was on industry, with mining and manufacturing taking 22.5%, electric power 18.7%, transportation and communications 17.2%, and agriculture 12.1%. The fifth plan was cut short a year early, in 1978, and, with India enmeshed in recession and political turmoil, work began on the sixth development plan (1980–85). Its goal, like that of the fifth, was the removal of poverty, although the planners recognized that this gigantic task could not be accomplished within five years. The plan aimed to strengthen the agricultural and industrial infrastructure in order to accelerate the growth of investments and exports. Projected outlays totaled r975 billion, of which electric power received 27.1%, industry and mining 15.4%, transportation and communications 12.7%, and agriculture 12.2%. The main target was a GDP growth rate of 5.2% annually. The seventh development plan (1985–90) projected 5% overall GDP growth (which was largely achieved and even exceeded) based on increases of 4% and 8% in agricultural and industrial output, respectively. Outlays were to total r1,800 billion.

The eighth development plan (for 1992–97), drafted in response to the country's looming debt crisis in 1990–91, laid the groundwork for longterm structural adjustment. The plan's overall thrust was to stimulate industrial growth by the private sector, and thereby free government resources for greater investment in basic infrastructure and human resources development. In addition to liberalized conditions for private and foreign investment, the foreign exchange system was reformed, the currency devalued, the maximum tariff reduced from 350% to 85%, import barriers generally loosened, and those for key intermediate goods removed altogether. Reform of the tax system, reduction of subsidies, and restructuring of public enterprises were also targeted. While the eighth plan generally supported expansion of private enterprise, unlike structural adjustment programs in other developing countries, it did not stipulate a largescale privatization of the public sector.

As the eighth plan came to an end in 1997 most analysts proclaimed it a success; economic growth averaged 6% a year, employment rose, poverty was reduced, exports increased, and inflation declined.

The ninth development plan (1997–2002) focused on the redistribution of wealth and alleviation of poverty, the further privatization of the economy and attraction of foreign investment, and the reduction of the deficit. Overall there were improvements in the reform era including an increase in the GDP growth rate from an average of about 5.7% to about 6.1% in the eighth and ninth plan periods, a reduction of the percent in poverty from a third of the population to a fourth, increased literacy from 52% in 1991 to 65% in 2001, and India's emergence as a competitor in state of the art technologies of the new information age economy. However, persistent inefficiencies—unemployment and underemployment, and welfare deficiencies—remained. Moreover, after 1998 a series of domestic and international shocks brought a disturbing deceleration to India's economic growth.

In the tenth five-year plan, 2002–07, the government set the ambitious target of achieving an average 8% growth, above the level achieved during the ninth plan. Other monitorable economic targets include a reduction of the poverty rate by 5% by 2007, and by 15% by 2012; providing gainful and highquality employment at least equal to the projected increases in the labor force; increase in forest and tree cover to 25%, in 2007 and to 33% by 2012; all villages provided with sustained access to potable water by 2007; and cleaning of all major polluted rivers by 2007. Agricultural development was viewed as the core element of the tenth plan with attention to sectors most likely to create employment opportunities. These include agriculture in its extended sense, construction, tourism, transport, smallscale industries (SSI), retailing, IT, and communications enabling services. Industrial policy includes continued emphasis on privatization and deregulation. The ambitious 8% annual growth of the tenth plan was considered achievable because of the inefficiencies that have traditionally plagued Indian agriculture and industry. Because the scope for improvement is so wide, both in the public sector and in the private sector, strong growth can be expected from efficiency enhancing policies. GDP growth was forecast to end at the more modest rate of 7.8% in 2005/06, 7% in 2006/07, and 6.5% in 2007/08, due in part to high international oil prices.

The government remained committed to stimulating the agricultural sector, but balancing this with the need to reduce the budget deficit proved difficult. As of 2006, it was politically difficult for the United Progressive Coalition (UPA) government, led by the Congress Party, to continue with the disinvestment process, although it was expected to attempt to reduce subsidies to stateowned companies. Further liberalization was expected to expand the role of domestic and foreign privatesector firms. India's population was forecast to exceed that of China's by 2035; the huge and growing population remained India's foremost economic, social, and environmental problem. In December 2004, a major tsunami took nearly 11,000 lives, left almost 6,000 missing, destroyed $1.2 billion worth of property, and severely damaged the fishing fleet.

SOCIAL DEVELOPMENT

An employees' provident fund was established in 1954. In 2004, a voluntary old age, disability, and survivor benefit scheme was implemented for some low income employees and self-employed persons. Contributions are income related and at a flat rate. Provident fund old age benefits are available at age 55, or at any age if the worker is leaving the country permanently. Workmen's compensation was first enacted in 1923. Currently it provides coverage to lower income employees working for establishment with more than 10 employees. State governments arrange for the provisions of medical care for workers. Labor laws require employers to provide severance pay in certain situations.

The program for old age, disability, and death benefits are covered by a provident fund with deposit linked insurance for industrial workers in 177 categories. The system is partially funded by insured persons and employers, with a small pension scheme subsidized by the government. There is a social insurance system covering sickness and maternity as well as work injury. The law requires employers to pay a severance indemnity of 15 days pay for each year of employment.

Domestic violence is commonplace; in 2004 more than half of women surveyed believed it was justifiable and a normal part of married life. Wife murder, usually referred to as "dowry deaths," are still evident. Although the law prohibits discrimination in the workplace, women are paid less than men in both rural and urban areas. Discrimination exists in access to employment, credit, and in family and property law. Laws aimed at preventing employment discrimination, female bondage and prostitution, and the sati (widow burning), are not always enforced. India is a significant source and destination for thousands of trafficked women. Not only does the male population exceed that of females, but India is also one of the few countries where men, on the average, live longer than women. To explain this anomaly, it has been suggested that daughters are more likely to be malnourished and to be provided with fewer health care services. Female infanticide and feticide is a growing problem in a society that values sons over daughters. It is estimated there are nearly 500,000 children living and working on the streets. Child prostitution is widespread. Children are subject to beatings in school and abuse during religious ceremonies.

Human rights abuses, including incommunicado detention, are particularly acute in Kashmir, where separatist violence has flared. Although constitutional and statutory safeguards are in place, serious abuses still occur including extrajudicial killings, abuse of detainees, and poor prison conditions. Despite efforts to eliminate discrimination based on the longstanding caste system, the practice remains unchanged. Prison conditions are harsh, and the judicial system is severely overloaded.

HEALTH

Great improvements have taken place in public health since independence, but the general health picture remained far from satisfactory. The government has paid increasing attention to integrated health, maternity, and child care in rural areas. An increasing number of community health workers and doctors are being sent to rural health centers. Primary health care is provided to the rural population through a network of over 150,000 primary health centers and subcenters that are staffed by trained midwives and health guides.

As of 2004, there were an estimated 51 physicians and 62 nurses per 100,000 people. In the mid-1990s, there were nearly 40,000 hospitals and dispensaries. In addition, the rural population was served by more than 130,000 subcenters, over 20,350 primary health centers, and nearly 2,000 community health centers. There are also numerous herb compounders, along with thousands of registered practitioners following the Ayurvedic (ancient Hindu) and Unani systems.

India has modern medical colleges, dental colleges, colleges of nursing, and nursing schools. More than 100 colleges and schools teach the indigenous Ayurvedic and Unani systems of medicine and 74 teach homeopathy. New drugs and pharmaceutical plants, some assisted by the UN and some established by European and American firms, manufacture antibiotics, vaccines, germicides, and fungicides. However, patent medicines and other reputed curatives of dubious value are still widely marketed; medical advisors of the indigenous systems and their curatives probably are more widely followed than Western doctors, drugs, and medical practices.

Total health care expenditure was estimated at 5.4% of GDP. Average life expectancy increased from 48 years in 1971 to 64.35 years in 2005. Infant mortality declined from 135 per 1,000 live births in the mid-1970s to 56.29 in 2005. The high mortality rate among infants and children is directly linked to size of family, which is being reduced through the small family norm (National Family Planning Program). The overall mortality rate in 2002 was an estimated 8.6 per 1,000 people.

The government of India took stringent measures to prevent plague following outbreaks during 1994. Mandatory screenings at airports and inspections of passengers were instituted. A shortterm multidrug therapy launched in India in 1995 led to a dramatic fall in the leprosy prevalence. The incidence of malaria was reduced by 98% between 1953 and 1965, but the number of reported cases increased from 14.8 million in 1966 to 64.7 million in 1976 because DDTresistant strains of mosquitoes had developed. The incidence of malaria in 1995 was 295 cases per 100,000 people. The death toll from smallpox was reduced to zero by 1977 through a massive vaccination program and plague had not been reported since 1967. Between 1948 and 1980, 254 million people were tested for tuberculosis and 252 million received BCG, an anti-tuberculosis vaccine. In 1999, there were 185 reported cases of tuberculosis per 100,000 people. In 1994, there was a serious outbreak of pneumonic plague in western India, which spread to others parts of the country, killing thousands. Many diseases remained, especially deficiency diseases such as goiter, kwashiorkor, rickets, and beriberi. However, India's immunization rates for children up to one year old were high. Data from 1997 shows vaccinations against tuberculosis, 96%; diphtheria, pertussis, and tetanus, 90%; polio, 91%; and measles, 81%. There is also a national system to distribute vitamin A capsules to children because a lack of this vitamin contributes to blindness and malnutrition. As of the mid1990s, nearly 25% of the country's children had been reached. Hypertension is a major health problem in India. Between 3.5% and 6.5% of adults have high blood pressure.

India is currently the nation with the second most HIVinfected people. As of 2004, there were approximately 5,100,000 people living with HIV/AIDS in the country. The HIV/AIDS prevalence was 0.90 per 100 adults in 2003. There were an estimated 310,000 deaths from AIDS in 2003.

HOUSING

Though progress has been made toward improving the generally primitive housing in which most Indians live, there are still some deficits in housing supply and access to basic utilities. A number of subsidized, lowcost housing schemes have been launched by the government, but the goal of providing a house for every homeless family cannot be met because of the prohibitive cost. The sixth five-year plan envisaged an expenditure of r94 billion for rural housing and r35 billion for urban housing during the period 1980–85, including r11.9 billion to provide shelter for homeless people. The eighth five-year plan (1990–95) called for an investment of $40 billion in housing, with 90% of this sum earmarked for the private sector. The government's goal is to provide eight million new housing units between 1990 and 2000, two million to fill the existing backlog and six million to meet the needs that would be created by population growth.

According to the 2001 national census, there were about 187,063,733 residential dwelling units nationwide. About 50% were considered to be in "good" condition and 44% were described as "livable." Many rural dwellings are constructed of mud brick or burnt brick walls with mud floors and a thatched or tiled roof. Urban dwellings are made from concrete or burnt brick. In 2001, only about 51.6% of all residential dwellings were considered to be permanent structures. Only about 38.9% of all households had drinking water within their premises. About 55% of dwellings had access to electricity. Only about 36% of all dwellings had bathroom facilities within the house.

EDUCATION

In 1986, the National Education Policy (NPE) was adopted in order to bring about major reforms in the system, primarily universalization of primary education. In 1988, a national literacy mission was launched, following which states, like Kerala and Pondicherry, achieved 100% literacy. In 1992, the second program of action on education was introduced to reaffirm the 1986 policy with plans to achieve total literacy and free education for all children up to grade eight.

The main goal has been primary education for children in the 6–11 age group. An emphasis on "basic education"—learning in the context of the physical and cultural environment, including domestic and commercial productive activities—has met with some success. In addition to expansion of primary education, there has been marked increase in educational facilities in secondary schools, colleges, universities, and technical institutes. An intensive development of adult education is under way in both urban and rural areas.

Free and compulsory elementary education is a directive principle of the constitution. Eight years of basic education are divided into three stages of lower primary school (five years), middle school (three years) and secondary school (two years). Following this, students may choose to attend a two-year senior secondary school or a three-year vocational school. The academic year runs from July to April.

In 2001, about 30% of children between the ages of three and five were enrolled in some type of preschool program. Primary school enrollment in 2003 was estimated at about 88% of age-eligible students; 90% for boys and 85% for girls. It is estimated that about 81% of all students complete their primary education. The student-to-teacher ratio for primary school was at about 40:1 in 2000; the ratio for secondary school was about 33:1. In 2000, private schools accounted for about 16.5% of primary school enrollment and 43% of secondary enrollment.

India's system of higher education is still basically British in structure and approach. The university system is second in size only to that of the United States' with 150 universities and over 5,000 colleges and higherlevel institutions. Educational standards are constantly improving and especially in the area of science and mathematics in which standards are as high as those found any-where in the world. The older universities are in Calcutta, Mumbai (formerly Bombay), and Chennai (formerly Madras), all established in 1857; Allahābād, 1877; Banares Hindu (in Varanasi) and Mysore (now Karnataka), both in 1916; Hyderābād (Osmania University), in 1918; and Aligarh and Lucknow, both in 1921. Most universities have attached and affiliated undergraduate colleges, some of which are in distant towns.

Christian missions in India have organized more than three dozen collegerank institutions and hundreds of primary, secondary, and vocational schools. In addition to universities there are some 3,500 arts and sciences colleges (excluding research institutes) and commercial colleges, as well as 1,500 other training schools and colleges. The autonomous University Grants Commission promotes university education and maintains standards in teaching and research. Many college students receive scholarships and stipends. In 2003, about 12% of the tertiary age population were enrolled in some type of higher education program. The adult literacy rate for 2004 was estimated at about 61%, with 73.4% for men and 47.8% for women.

As of 2003, public expenditure on education was estimated at 4.1% of GDP, or 12.7% of total government expenditures.

LIBRARIES AND MUSEUMS

The National Library in Calcutta, with over 22 million books and numerous other items, is by far the largest in the country. Some of the other leading libraries are the New Delhi Public Library (1.4 million volumes), the Central Secretariat Library in New Delhi (700,000 volumes), and the libraries of some of the larger universities. The Khuda Baksh Oriental Library in Patna, with a collection of rare manuscripts in Arabic, Urdu, and Farsi, is one of 10 libraries declared "institutions of national importance" by an act of parliament. The National Archives of India, in New Delhi, is the largest repository of documents in Asia, with 25 km (16 mi) of shelf space. There is an extensive public library system as well as cultural and religious institutions and libraries throughout the country.

Noted botanical gardens are located in Calcutta, Mumbai (formerly Bombay), Lucknow, Ootacamund, Bangalore, Chennai (formerly Madras), and Darjeeling, and well-stocked zoological gardens are found in Calcutta, Mumbai, Chennai, Trivandrum, Hyderābād, Karnataka, and Jodhpur. Most of India's hundreds of museums specialize in one or several aspects of Indian or South Asian culture; these include 25 archaeological museums at ancient sites, such as Konarak, Amravati, and Sarnath. Some of the more important museums are the Indian Museum in Calcutta, the Prince of Wales Museum of Western India in Mumbai (formerly Bombay), and the National Museum and the National Gallery of Modern Art, both in New Delhi.

There are also municipal museums throughout the country and dozens of museums and galleries devoted to prominent South Asian artists. There are science museums in Bhopāl, Calcutta, Mumbai (formerly Bombay), and New Delhi. Bhavongor houses the Gandhi Museum, one of several sites devoted to the history of the national hero. In 2001 the Broadcasting Museum was founded in Delhi. There also are thousands of architectural masterpieces of antiquity—the palaces, temples, mausoleums, fortresses, mosques, formal gardens, deserted cities, and rockhewn monasteries—found in every section of the subcontinent.

MEDIA

All postal and telegraph and most telephone services are owned and operated by the government. International telephone services, both radio and cable, are available between India and all major countries of the world. In 2003, there were an estimated 46 mainline telephones for every 1,000 people; over one million people were on a waiting list for telephone service installation. The same year, there were approximately 25 mobile phones in use for every 1,000 people.

All-India Radio (AIR), governmentowned, operates short- and mediumwave transmission through over 100 stations and broadcasts in all major languages and dialects for home consumption. AIR also operates external services in 24 foreign and 36 Indian languages. There are privately licensed radio stations, but they are only permitted to broadcast educational or entertainment programming. News broadcasting by independent radio stations is prohibited. In 1959, India's first television station was inaugurated in Delhi, and color television broadcasting was inaugurated in 1982. The public television service, Doordarshan, operates 21 national, regional, and local services. The School Television Section broadcasts regular inschool instruction programs on selected subjects. Cable and satellite stations have fairly large audiences. As of 1999, there were, altogether, 153 AM and 92 FM radio stations and 562 television stations. In 2003, there were an estimated 120 radios and 83 television sets for every 1,000 people. About 398.9 of every 1,000 people were cable subscribers. Also in 2003, there were 7.2 personal computers for every 1,000 people and 17 of every 1,000 people had access to the Internet. There were 462 secure Internet servers in the country in 2004.

India has a thriving film industry, centered at Mumbai (formerly Bombay), Chennai (formerly Madras), Calcutta, and Bangalore. Indians are avid filmgoers and users of videocassettes.

The first newspaper in India, an Englishlanguage weekly issued in Calcutta in 1780, was followed by Englishlanguage papers in other cities. The first Indianlanguage newspaper (in Hindi) appeared in Varanasi (Benares) in 1845. There are hundreds of newspapers in circulation throughout the country, published in some 85 languages, primarily Hindi, English, Bengali, Urdu, and Marathi. The majority of Indian newspapers are under individual ownership and have small circulations. About 30% are published in Delhi, Mumbai (formerly Bombay), Calcutta, and Madras.

The principal national Englishlanguage newspapers are the Indian Express, with editions published in Mumbai (formerly Bombay) and 10 other cities, and the Times of India, published in Ahmadābad, Mumbai, Delhi, and three other cities. The largest Hindi daily is the Navbharat Times, published in Mumbai with a 2002 circulation of 418,500. Other major Hindi dailies (with estimated 2002 circulation) are: Punjab Kesari (173,390), Hindustan (98,900), and Dainik Jagran (409,480). Leading Englishlanguage dailies (with estimated 2002 circulation) include: Indian Express (576,200), Times of India (536,166), The Economic Times (336,060), The Telegraph (234,500), and The Hindu (300,320). In 2002, there were two major Bengali dailies, Jugantar (circulation 302,000) and Aajkaal (157,713). The same year there were two major Marathi dailies, Lokasatta (258,090) and Maharashtra Times; two Tamil dailies, Thanthi (297,797) and Dinamani (178,230); and two major Malayalam dailies, Mathirubhumi (454,351) and Malayala Manorama (1,013,590).

In 1976, the four leading Indian news agencies—the Press Trust of India (English), United News of India (English), Hindustan Samachar (Hindi), and Samachar Bharati (Hindi)—merged to form Samachar, which means "news" in Hindi. The merger followed the cancellation by AIR of subscriptions to all four services. Samachar was dissolved in 1978, and as of 1991 there were three separate agencies: Indian News and Features Alliance, Press Trust of India, and United News of India.

Freedom of the press has been nominally ensured by liberal court interpretations of the constitution, but the government has long held the right to impose "reasonable restrictions" in the interest of "public order, state security, decency, and morality." On a day-to-day basis, the press is essentially unfettered, and news magazines abound in addition to the newspapers.

ORGANIZATIONS

There are many political, commercial, industrial, and labor organizations, and rural cooperatives. Almost all commercial and industrial centers have chambers of commerce. The Center of Indian Trade Unions and All India Trade Union Congress are umbrella organizations representing the rights of worker's. Other labor and industry organizations include the All India Association of Industries and the All India Manufacturers Organization. There are unions for more specialized trades and fields as well, such as the Silk Association of India. There are a number of scholarly and professional societies and associations focused on education and research in various scientific and medical fields, including the national Indian Medical Association. There are also several associations dedicated to research and education for specific fields of medicine and particular diseases and conditions. The Indian Academy of Sciences was established in 1934 to promote research and education in a variety of branches of pure and applied sciences. The Indian National Science Academy similarly promotes public interest in science.

Cultural activities, especially traditional arts and crafts, are promoted throughout India by the National Academy of Fine Arts; the National Academy of Music, Dance, and Drama; the National Center for the Performing Arts; and the National Academy of Letters. Other state organizations for the furthering of cultural activities include the Ministry of Information and Broadcasting, the Indian Council for Cultural Relations, and the National Book Trust. There are a great many private cultural and institutional organizations based on religion and philosophy, language (including Sanskrit and Pali), drama, music and dancing, modern writing, the classics, and painting and sculpture.

Notable national youth organizations include the All India Students Federation, Girl Guides and Scouts of India, Indian National Youth Organization, National Council of YMCA's of India, Service CivilYouth Volunteers of India, Student Christian Movement of India, Junior Chamber, Student Federation of India, the Bharat Scouts and Guides, Tibetan Youth Congress, United Nations Youth Organization of India, and Young Catholic Students of India. National women's organizations include All India Women's Conference, Women's Equal Rights Group, and Women's Protection League.

There are several national and local organizations and associations dedicated to providing assistance and services to the poor, disadvantaged, and marginalized, such as the Karnataka Welfare Society and Andhra Mahila Sabha. There are a wide variety of international organizations with chapters in India, including Christian Children's Fund, CARE, Caritas, Defence for Children International, Habitat for Humanity, the Red Cross, Amnesty International, Kiwanis, and Lion's Clubs. The International Health Organization has an office in New Delhi.

TOURISM, TRAVEL, AND RECREATION

The national Department of Tourism maintains tourist information offices at home and abroad. It has constructed many facilities for viewing wildlife in forest regions, by minibus, boat, or elephant; and operates tourist lodges in wildlife sanctuaries. The principal tourist attractions are India's distinctive music, dance, theater, festivals, and cuisines; the great cities of Calcutta, Mumbai (formerly Bombay), and Chennai (formerly Madras); and such monuments as the Red Fort and Jama Masjid mosque in Delhi, the Taj Mahal at Agra, and the Amber Palace in Jaipur. Tourists and pilgrims also flock to the sacred Ganges River, the Ajanta temple caves, the temple at Bodhgaya where the Buddha is said to have achieved enlightenment, and many other ancient temples and tombs throughout the country. All visitors must have a valid passport and an entry, transit, or tourist visa. The visa must be acquired before arrival. Vaccination against typhoid is recommended.

The big-game hunting for which India was once famous is now banned, but excellent fishing is available. There are also many golf courses. Cricket, field hockey, polo, football (soccer), volleyball, and basketball are all popular, as are ponytrekking in the hill stations and skiing in northern India.

All major cities have comfortable Westernstyle hotels that cater to tourists. In 2003, there were 2,726,214 tourist arrivals, almost 34% of whom came from Europe. Tourist receipts totaled $3.5 billion. The 91,720 hotel rooms with 183,440 beds had an occupancy rate of 60%.

In 2005, the US Department of State estimated the cost of staying in New Delhi at $245 per day. Daily expenses were estimated at $254 in Calcutta, $266 in Mumbai (formerly Bombay), and $353 in Bangalore.

FAMOUS INDIANS

Siddartha Gautama was (624–544 bc according to Sinhalese tradition; 563?–483? bc according to most modern scholars) later known as the Buddha ("the enlightened one"). Born in what is now Nepal, he spent much of his life in eastern Uttar Pradesh and Bihar, propounding the philosophical doctrines that were later to become Buddhism. Contemporary with the Buddha was Vardhamana (599?–527 bc), also known as Mahavira ("great hero"), a saintly thinker of Bihar from whose teachings evolved Jainism. Some of the noteworthy religious and political leaders were Chandragupta (r.321?–297? bc), founder of the Maurya Dynasty; Asoka (r.273–232 bc), who made Buddhism the religion of his empire; Chandragupta II (r. ad 375?–413), whose era marked a high point of Hindu art and literature; Shivaji (1627?–80), a hero of much Hindu folklore; Nanak (1469–1539), whose teachings are the basis of Sikhism; and Govind Singh (1666–1708), the guru who gave Sikhism its definitive form. Akbar (1542–1605) greatly expanded the Mughal Empire, which reached its height under Shah Jahan (1592–1666), builder of the Taj Mahal, and his son, the fanatical emperor Aurangzeb (1618–1707).

Sanskrit grammarian Panini (5th?–4th? centuries bc), wrote the first book on scientific linguistics. The Bengali educator and reformer Rammohan Roy (1772–1833) has been called "the father of modern India." Swami Vivekananda (1863–1902), founder of the nonsectarian Ramakrishna Mission and a great traveler both in India and abroad, did much to explain the Hindu philosophy to the world and to India as well. Sarvepalli Radhakrishnan (1888–1975), a leading 20thcentury Hindu scholar and philosopher, also served as president of India from 1962 to 1967. Another revered religious philosopher was Meher Baba (1894–1969). The rising position of India in science and industry is well exemplified by Jamshedji Nusserwanji Tata (1822–1904), founder of the nation's first modern iron and steel works as well as many other key industries; the physicist Jagadis Chandra Bose (1858–1937), noted for his research in plant life; Srinivasa Ramanujan (1887–1919), an amazingly original, although largely self-taught, mathematician; Chandrasekhara Venkata Raman (1888–1970), who was awarded the 1930 Nobel Prize for research in physics; Chandrasekhara Subramanyan (1910–95), also a Nobel Prize laureate in physics, and Vikram A. Sarabhai (1919–71), the founder of the Indian space program. Mother Teresa (Agnes Gonxha Bojaxhiu, 1910–97, in what is now Serbia and Montenegro) won the Nobel Peace Prize in 1979 for her 30 years of work among Calcutta's poor.

In modern times no Indian so completely captured the Indian masses and had such a deep spiritual effect on so many throughout the world as Mohandas Karamchand Gandhi (1869–1948). Reverently referred to by millions of Indians as the Mahatma ("the greatsouled one"), Gandhi is considered the greatest Indian since the Buddha. His unifying ability and his unusual methods of nonviolent resistance contributed materially to the liberation of India in 1947. A leading disciple of the Mahatma, Vinayak ("Vinoba") Narahari Bhave (1895–1982), was an agrarian reformer who persuaded wealthy landowners to give about 600,000 hectares (1,500,000 acres) of tillable land to India's poor.

Gandhi's political heir, Jawaharlal Nehru (1889–1964), had a hold on the Indian people almost equal to that of the Mahatma. Affectionately known as Chacha (Uncle) Nehru, he steered India through its first 17 years of independence and played a key role in the independence struggle. Indira Gandhi (1917–84), the daughter of Nehru and prime minister from 1966 to 1977 and again from 1980 to 1984, continued her father's work in modernizing India and played an important role among the leaders of nonaligned nations. Her son Rajiv (1944–91) succeeded her as prime minister and, in the 1985 election, achieved for himself and his party the largest parliamentary victory since India became independent. Subsequent prime ministers have been: P.V. Narasimha Rao (1921–2004, served 1991–96), Atal Behari Vajpayee (b.1924, served 1996 and 1998–2004), and Dr. Manmohan Singh (b.1932), who began his term in 2004.

A classical Sanskrit writer in Indian history was the poet and playwright Kalidasa (fl. 5th cent. ad), whose bestknown work is Shakuntala. In modern times, Rabindranath Tagore (1861–1941), the great Bengali humanist, influenced Indian thought in his many songs and poems. Tagore received the Nobel Prize in literature in 1913 and through his lifetime wrote more than 50 dramas and about 150 books of verse, fiction, and philosophy. Another Bengali writer highly esteemed was the novelist Bankim Chandra Chatterjee (1838–94). Tagore and Chatterjee are the authors, respectively, of India's national anthem and national song. The novel in English is a thriving genre; notable modern practitioners include Rasipuram Krishnaswamy Narayan (1906–2001), Bhabani Bhattacharya (1906–88), Raja Rao (b.1908) and Khushwant Singh (b.1915). Other contemporary Indianborn novelists writing in English include: Anita Desai (b.1937), Bharati Mukherjee (b.1940), Salman Rushdie (b.1947), and Arundhati Roy (b.1961); Jhumpa Lahiri (b.1967) is an American author of Indian descent. Influential poets of the last two centuries include the Bengalis Iswar Chandra Gupta (1812–59) and Sarojini Naidu (1879–1949), known as "the nightingale of India," a close associate of Gandhi and a political leader in her own right.

Modern interpreters of the rich Indian musical tradition include the composer and performer Ravi Shankar (b.1920) and the performer and educator Ali Akbar Khan (b.1922). Zubin Mehta (b.1936) is an orchestral conductor of international renown. Uday Shankar (1900?–1977), a dancer and scholar, did much to stimulate Western interest in Indian dance. Tanjore Balasaraswati (1919?–84) won renown as a classical dancer and teacher. Preeminent in the Indian cinema is the director Satyajit Ray (1921–92).

DEPENDENCIES

Andaman and Nicobar Islands

The Andaman and Nicobar Islands are two groups of islands in the Indian Ocean, extending approximately 970 km (600 mi) n–s and lying about 640 km (400 mi) w of both the Tenasserim coast of Myanmar and peninsular Thailand. Their total area is 8,293 sq km (3,202 sq mi); their population was estimated to exceed 188,000 in the mid-1990s. These islands together form a union territory with its capital at Port Blair. The legal system is under the jurisdiction of the high court of Calcutta.

The Andaman Islands extend more than 354 km (220 mi) between 10 and 14°n and 92°12′ and 94°17′ e. Of the 204 islands in the group, the three largest are North, Middle, and South Andaman; since these are separated only by narrow inlets, they are often referred to together as Great Andaman. Little Andaman lies to the south.

The Nicobars extend south from the Andamans between 10 and 6°n and 92°43′ and 93°57′e. Of the 19 islands, Car Nicobar, 121 km (75 mi) s of Little Andaman, holds more than half the total population; the largest, Great Nicobar, 146 km (91 mi) nw of Sumatra, is sparsely populated.

The Andamans were occupied by the British in 1858, the Nicobars in 1869; sporadic settlements by British, Danish, and other groups were known previously. During World War II (1939–45), the islands were occupied by Japanese forces. They became a union territory in 1956. That same year, the Andaman and Nicobar Islands (Protection of Aboriginal Tribes) Act came into force; this act, designed to protect the primitive tribes that live in the islands, prohibited outsiders from carrying on trade or industry in the islands without a special license. Six different tribes live in the Andaman and Nicobar Islands, the largest being the Nicobarese. There are lesser numbers of Andamanese, Onges, Jarawas, Sentinalese, and Shompens in the dependency. Access to tribal areas is prohibited.

Agriculture is the mainstay of the economy. The principal crops are rice and coconuts; some sugarcane, fruits, and vegetables are also grown. There is little industry other than a sawmill and plywood and match factories, but the government is making plans to promote tourism in the islands. These plans include the construction of a 1,000-bed hotel, a casino, and duty-free shopping facilities in Port Blair.

Lakshadweep

The union territory of Lakshadweep consists of the Laccadive, Minicoy, and Amindivi Islands, a scattered group of small coral atolls and reefs in the Arabian Sea between 10° and 13°n and 71°43′ and 73°43′e and about 320 km (200 mi) w of Kerala state. Their total area is about 32 sq km (12 sq mi). Minicoy, southernmost of the islands, is the largest.

In the mid-1990s, the population of Lakshadweep was estimated to exceed 40,000. The inhabitants of the Laccadives and Amindivis are Malayalamspeaking Muslims; those on Minicoy are also Muslim, but speak a language similar to Sinhalese. The islanders are skilled fishermen and trade their marine products and island-processed coir in the Malabar ports of Kerala. The main cottage industry is coir spinning. Politically, these islands were under the control of the state of Madras until 1956. The present territorial capital is at Kavaratti. Judicial affairs are under the jurisdiction of the high court of Kerala.

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