Tough steps on anvil to achieve 8% growth: PM

NEW DELHI: Prime Minister Atal Bihari Vajpayee on Saturday declared that hard decisions, including privatisation of public sector undertakings, will be taken as part of tough reform measures to achieve 8 per cent annual growth during the Tenth Plan. Difficult decisions on labour, financial, tax reforms and agriculture marketing will have to be taken to move on to a high 8 per cent growth in the Tenth Plan for which there was consensus at the National Development Council, Vajpayee said in his opening remarks at the full Planning Commission meeting held here to approve the Tenth Plan document. Allaying apprehensions on FDI, Vajpayee said let there be no worry in any quarters that we would follow such an FDI policy as would weaken the Indian industry or hurt national interest . This will never happen, he said adding, however, greater inflow of FDI was needed to supplement domestic resources where it would strengthen economy and enhance competitiveness. The Prime Minister said India could not afford to set a lower growth target if we want to move towards our cherished dream of building an India free of poverty, illiteracy and homelessness, free of regional, social and gender disparities . Vajpayee said an 8 per cent GDP growth was also essential in view of fears in certain quarters that the rate of unemployment could rise further going by the present rate of growth of the labour force. The issue before us is not whether we can achieve a significantly higher growth rate, rather, it is whether can we afford not to. He said the draft Tenth Plan addresses the concerns on the content and direction of India''s development. Accordingly, it lays much emphasis on speeding up the development of agriculture, agro-industries, small-scale and cottage industries and the whole array of activities in the informal sector, Vajpayee said. The Prime Minister said fiscal prudence with all its attendant measures will have to be pursued vigorously both by the Centre and state governments. We have to squeeze maximum efficiency and productivity on every rupee of investment already made. Specifically, we must utilise excess capacity effectively, upgrade exisiting capital assets... reduce public sector dissavings and remove all non-financial barriers to speedier development, he said. In this context, it would be pertinent to effect labour reforms, remove legal and other restrictions in the evolution of the national market, particularly for agriculture, and actively pursue disinvestment of our PSUs. Expressing concern over the very slow pace of power sector reforms, he said the removal of bottlenecks in the energy, transport and water infrastructure were tasks that could no longer be delayed. One of the principal reasons why our current growth rate is stagnating at around 5.5 per cent is due to severe infrastructural constraints, which can only be eased by accelerating reforms , Vajpayee said. Elaborating on the concerns being addressed in the draft Tenth Plan, Vajpayee said the document stresses the need to increase flow of credit to the informal sector through micro-finance and other measures. In addition, we must ensure that a range of legal impediments faced by the unorganised sector are quickly removed. He said the draft plan makes it very clear that bulk of the vastly higher level of savings and investments needed to achieve the 8 per cent growth target would have to come from domestic sources. Complimenting the Planning Commission for drafting the formidable document, Vajpayee said it reflects the intellectual effort that has gone into its preparation. Speaking at the meeting, Deputy Chairman K C Pant said the country has the potential to effect a significant turnaround within a short span of time to achieve improvements in economic and social indicators. Pant, however, said that efforts will have to be made to ensure that the growth momentum in non-agricultural sectors that has been in evidence in the first quarter of this year is maintained . In this context, strong and coordinated effort by all central ministries, including the Ministry of Finance and the Planning Commission, would be required, he said. Pant said the most pressing issue facing the country was the rapid growth in labour force that it was likely to experience over the next decade. At current rates of growth and with the current labour intensity in production, we face the possibility of rising unemployment, which could lead to social unrest, he warned, adding issues of poverty and the unacceptably low levels of social indicators would have to be addressed. Elaborating on the Tenth Plan document, he said, we are working towards specific monitorable targets which need to be attained along with the growth target . The plan document has for the first time broken down the national targets to the state-level to enable the states to better focus on their own development plans. While traditionally plans have focussed on sectoral policies and programmes for implmenting the plan objectives, taking into account the present market-oriented economy a carefully crafted medium-term macroeconomic policy stance, both for the centre and the states, has been made a feature of the Tenth Plan, he said. Related link: Â Vajpayee settles selloff row

Tough steps on anvil to achieve 8% growth: PM

Prime Minister Atal Bihari Vajpayee on Saturday declared that hard decisions, including privatisation of public sector undertakings, will be taken as part of tough reform measures to achieve 8 per cent annual growth during the Tenth Plan.

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