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Home / Business News / Only industrialisation can resolve poverty: PM

Only industrialisation can resolve poverty: PM

PM says Industrialisation ought to be a win-win process for social transformation and economic development for India.

business Updated: May 01, 2007 16:44 IST

Industrialisation may throw up challenges like alienation of the working class, environmental damage and displacement of people, but is necessary for social transformation and economic development,Prime Minister Manmohan Singh has said.

"It is only through rapid industrialisation that we can find meaningful solution to the problem of mass unemployment, underdevelopment," the prime minister said, inaugurating the campus of the Institute for Studies in Industrial Development.

The think tank, that focuses on the problems faced because of industrialisation, has been founded by former prime minister Chandra Shekhar.

"Concerns will be expressed, especially by those who may see themselves as losers in the process of industrialisation. We must learn to address their concerns and assuage them to the extent possible," Manmohan Singh added.

"Industrialisation ought to be a win-win process for social transformation and economic development. A developing country like ours just cannot afford to view industrialisation as a negative phenomenon."

The prime minister said he was struck by recent comments in the media that most of the billionaires among India's top business leaders operated in oligopolistic markets and in areas where the government conferred special privileges on a few.

"This sounds like crony capitalism. Are we encouraging crony capitalism? Is this a necessary but transient phase in developing modern capitalism in our country? Are we doing enough to protect consumers, small businesses?" he queried.

He asked research institutions to come up with solutions on how to prevent such crony capitalism, inject greater competition in the industrial sector and tackle concerns faced by domestic enterprise.

Three decades ago, the prime minister said, there was palpable concern and worry over multinational corporations overpowering Indian companies, but the situation today has changed when one only heard of opportunities on hand.

"Today Indian companies are going global, becoming multinationals. The process may yet be incipient, but the change is visible and here to stay. The nature of competition has changed and so has the nature of regulation," he said.

This, he said, required efforts to ensure that markets remained competitive, monopolistic practices were curtailed and the growth became more balanced, inclusive and more tuned towards employment generation.

The prime minister also spoke about his other concerns and said he was puzzled by the persisting regional imbalances in industrial development and urbanisation in India.

"We need credible solutions to help reduce imbalances. Industrial development must spread to new regions, especially in the northern and eastern India. What are the lessons we can learn from the experience of western and southern India?"

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