Prime Minister Manmohan Singh struck an optimistic note by projecting a 10 per cent economic growth by 2012 “with the right set of policies” in his opening address at the National Development Council on Wednesday. He, however, cautioned that growth alone cannot be the goal and objective of all planning processes.
He emphasised the need to ensure that economic planning afforded stakes to all sections of the society, especially those on the margins. On the 11th Five Year Plan, he said, “The plan’s focus is on the most marginalized sections of society. The goal of this plan is to invest in our people to enable them to become active participants in economic growth processes”.
Singh also noted the clouds on global financial markets following the subprime lending crisis in the United States and its possible impact on the Indian economy.
“There are worries that the growth of the US and other leading economies may slow down and some may even go into a recession,” he said.
“We cannot be fully immune to international developments,” he said referring to the downside of the external sector accounting for nearly 40 per cent of the Gross Domestic Product and the impact that would follow on India’s exports and capital flows.
Singh — who focussed on domestic challenges like inter-regional disparity, the widening rural-urban divide and the slow reduction in poverty levels — emphasised that the way to reduce the impact of developments abroad was to redouble efforts to maintain domestic drivers of growth and make it inclusive.
“Global trends in food production and prices and our patterns of consumption are going to put increasing pressure on both the availability and prices of basic food items," the prime minister said.
If India has to manage these pressures, the agriculture sector would have to achieve its four per cent growth target and food planning adjusts to the emerging market realities.
"We probably need to realise the we are going to be importers of some food items for many years," he said, suggesting the country revisit food grain procurement strategies in the short-term, enhance buffer stocks of food grains and consider buffer stocks for pulses and edible oils too.
In his concluding remarks, Singh later announced a task force to comprehensively examine resource requirements for expanding irrigation and identifying a new approach for implementing them. He also declared that the Centre would shortly announce a scheme for addressing the issue of debt burden of farmers.
He identified subsidies and power sector as major areas of concern and said that states should work in tandem with the Centre to ensure subsidies were targeted at the needy.
With discussions centred around a plan that focuses on development of social and human capital, Singh said the public investment was only part of the story.
"The other part is to ensure that our programmes are designed and implemented effectively and efficiently and that leakages are stopped," he said.
Responding to concerns that red tape at the centre was slowing down infrastructure projects, Singh also announced an expert group at the finance ministry to go into the system of statutory clearances for industrial and infrastructure projects to come up ways to speed up the approvals and directed the power ministry to accelerate sanctioning processes for rural electrification. A committee would also be set up to look into problems of hill states and hill areas.