Change mindset, resist populism: PM

"The old fashioned attitude of chalta hai (everything goes) is not consistent with our development potential," said PM.

india Updated: Sep 28, 2006 18:09 IST

Prime Minister Manmohan Singh on Thursday asked business leaders, politicians and bureaucrats to give up their old mindsets, desist from competitive populism and pull down trade barriers to push India's development.

"The old fashioned attitude of chalta hai (everything goes) is not consistent with our enormous development potential," the prime minister told a conclave with the chief ministers of northern states in Chandigarh.

"All those who are given this responsibility of managing our economy—whether politicians, civil servants, businessmen, they have to live up to the challenge as well as the enormous opportunity that lie before our country," he added.

The prime minister also called for greater attention towards the youth of the country at the conclave organised by the PHD Chamber of Commerce and Industry—better known by the acronym PHDCCI.

"We are home to 20 per cent of the world's population below 24 years of age. This youthful population will provide human resource, their savings and the financial resource, for sustaining growth in the next 20 years," the prime minister said.

"However, we cannot assume that demographic trends will automatically translate into accelerated growth. People must acquire capabilities to take advantage of the growth opportunities," he added.

The prime minister also came down heavily on competitive populism among states, especially in signing memoranda of understanding with fiscal incentives and tax sops to promote industrial development.

"The jury is still out on whether these policies promote industrial growth. But in the process, in the excitement to have headline grabbing pacts, we offer incentives, both fiscal and financial—which our finances cannot sustain."

He said the industry and states must work together to ensure that there is no "race to the bottom" in fiscal terms through competitive populism so that a "common economy" and a "single market" can emerge in India.

Manmohan Singh, who grew up in Amritsar, said that northern states lagged behind the western Indian states on many parameters. The human development index and revenue earning of the western states was much more than the northern states, he said.

"If our present rate of growth at eight per cent is sustained, Punjab will become a Germany by 2020 while Uttar Pradesh will become like Punjab in development. But for that to happen, the states must correct inter-regional imbalances."

The conclave was attended by Punjab Chief Minister Amarinder Singh, Haryana's Bhupinder Singh Hooda, Jammu and Kashmir's Ghulam Nabi Azad, Himachal Pradesh's Virbhadra Singh, and Delhi's Sheila Dikshit.

Chandigarh's Administrator and Punjab Governor SF Rodrigues was also present at the conclave attended by ministers and senior officials of these states, as also businessmen and top executives.

In a passionate speech, the prime minister also asked the states to make their cities more modern and attractive.

"Unlike in the west and south of our country, this region is dominated by one big urban centre, namely the National Capital Region of Delhi, Gurgaon and Noida," the prime minister said.

"You must take full advantage of the National Urban Renewal Mission to change your urban landscape and make the cities modern, productive and more attractive. You need new urban centres. The region must see a wave of city development."

First Published: Sep 28, 2006 18:09 IST