Centre will control inflation without hurting growth: PM

NEW DELHI: With price pressure taking away huge chunks of the UPA’s political capital and threatening to hurt the growth momentum, prime minister Manmohan Singh on Thursday said the immediate priority of his government would be to “curb inflationary pressures without hurting the strong growth impulses”.

Mr Singh, who said that he shared his party’s as well as the Opposition’s concern over spiralling prices, said his government was “very serious about brining inflation under control”. He acknowledged that the poor bear the brunt of high inflation.

In the course of his speech, the prime minister admitted that the high growth rate was by itself insufficient in tackling poverty. But at the same time, he was bullish about the economic outlook. “Many efforts have been made to soften the harsh edges of extreme poverty, but we still have a long way to go. To do so, we need a rapidly expanding economy,” he said.

That Mr Singh recognises that inflation could be a big drag for his party and the alliance was evident when he said there was need for making sure that it does not become an endemic problem as witnessed in some Latin American countries. “The house has my assurance that we will make sure that the agricultural economy gets the required momentum and inflation is brought under control,” he said in the Rajya Sabha.

The prime minister admitted that if the government had moved in to import wheat a little earlier last year, it would have averted the grain shortage in the country. “Some delay did take place, but it is a thing of the past,” the prime minister said.

On agriculture, he said the shrinking per capita size of agricultural holdings has meant that there is a limit to which agricultural incomes and productivity can be increased, and there was a need to emphasise the importance of industrialisation.

Although a very valid point, the political class within the ruling side is yet to appreciate it.
On the contentious issue of SEZs, Mr Singh said there was a need for industrialisation and for labour-intensive industries and for this incentives needed to be given at a time when labour as well as capital has become “fully mobile”.

“If we have made any mistake we will make the necessary corrections,” he said. Referring to the issue of land acquisition, Mr Singh said the issue has to be dealt with in a more “humane” manner.

On the social situation, the prime minister said that he shared the concerns expressed by the members about the signs of communal resurgence and sectarian intolerance.

He said the Sachar report had brought out the stark reality of the condition of the Muslim community. He said the government was in the process of designing targeted programmes for minorities. However, he did talk about how the government proposes to implement the Sachar report suggestions.

On the Pakistan front, he said resolute efforts were being made to improve ties with Pakistan and these have started yielding “positive results”. He also expressed the confidence that all outstanding issues with Pakistan would be resolved through dialogue. “We have been working purposefully for all-round improvement of relations with Pakistan”.