The Narendra Modi-led NDA government on Monday vowed to revive the economy from its worst slump in a quarter century with a raft of measures to breathe life into the waning industrial sector and spin jobs.
“Putting the Indian economy back on track is paramount…the government will create a policy environment which is predictable, transparent and fair,” President Pranab Mukherjee said in his customary address to both houses of Parliament.
The speech, drawn up by the Modi cabinet shortly after it assumed office, makes economic revival the topmost priority of the new government.
The economy, which till recently was touted as a regional titan on the verge of rivalling China both in terms of size and rapidity of expansion, is now snowed under problems. It has grown at below 5% for two successive years for the first time since 1986. Industrial activity has contracted and retail inflation is galloping towards the worrisome 10% mark.Finance minister Arun Jaitley, who met state finance ministers on Monday to seek inputs for the full budget for 2014-15 early next month, acknowledged the economic situation was challenging.
“The manufacturing sector had an abysmal performance last year. The investment cycle has been disturbed,” he said. “The slowdown in economic growth coupled with high inflationary pressure poses a challenge to the macroeconomic environment.”
President Mukherjee said the government will crack down on hoarders and black marketeers to keep prices under check and also strengthen the public distribution system (PDS).
Later in the day, Jaitely echoed similar views when he said restructuring the Food Corporation of India—a BJP poll promise—and decentralised procurement of food grains were on the government agenda.
“PDS as a vehicle to shield the poor from price rise has to be significantly improved. Some states have done extremely well in improving the delivery under PDS. We can learn from them,” Jaitley said. While seeking support from states to take projects forward, he said investment in infrastructure can create jobs and catalyse industral growth.