Manmohan Singh says 9 pct growth in 12th five-year possible, but with fiscal correction

New Delhi, Aug.20 (ANI): The Prime Minister, Dr. Manmohan Singh, on Saturday said achieving nine percent growth during the 12th five-year-plan period (2012-17) would require large investments in infrastructure development as well as appropriate fiscal corrections in the Indian economy.

Delivering an opening statement at the start of a full planning commission meeting here today, Dr. Singh, referring to the Approach Paper on the 12th five-year-plan, said: "Achieving nine percent growth will require large investments in infrastructure sector development. The Approach Paper notes that we have been fairly successful in the eleventh Plan in using a combination of public investment and Public Private Partnerships for infrastructure development. We need to bring greater momentum to both these components so that present infrastructure shortages can be addressed in the shortest time available.

He added: "The Planning Commission has rightly endorsed the importance of the process of fiscal correction announced by the Finance Minister (Pranab Mukherjee), even if this means that total resources available for the plan in the short run will be limited. Resource limitations imply the need to prioritise carefully. Some priority areas, e.g., health, education and infrastructure will have to be funded more than others.

"Faced with resource constraints we must also focus much more on efficient use of available resources. The paper makes several suggestions in this regard, including giving implementing agencies greater amount of freedom , flexibility, promoting convergence between resources from different plan schemes and the need for much greater attention to capacity building, monitoring and accountability. We need to engage the states on all issues," Dr. Singh said further.

He said that the draft Approach Paper reflected the directions that had been given during the last meeting of the Planning Commission and the important inputs that have been received from the consultation process.

Touching on some other key points, Dr. Singh said that the Planning Commission had examined the range of 9 to 9.5 percent growth which the government had asked it to consider, and the commission had said that the nine percent target is feasible only if some difficult decisions were taken.

"The commission has emphasized the importance of achieving four percent growth in agriculture both because it provides broad based income benefits to the rural population and also because it is necessary to avoid inflationary pressure which could arise if high levels of growth are attempted without corresponding growth in domestic food production capabilities," the Prime Minister said.

He revealed that the Approach Paper also outlined the multiple interventions necessary to achieve the agricultural growth objective.

He said that the three percent agricultural growth stated in the Eleventh Plan, would now be raised to 3.3 percent in the 12th Five-Year plan.

Reflecting on the government's major flagship programmes, Dr. Singh said that a total of Rs.1,87,000 crores has been spent on these programmes in 2011-12.

He said that these programmes would continue in the Twelfth Plan, with a focus on issues of implementation and governance to improve their effectiveness.

He said that the Approach Paper also pointed out that high growth requires supporting growth in energy and because domestic energy supplies are limited.

"Our dependency on energy imports is likely to continue to go up. In this situation we have to take steps to reduce energy intensity of production processes and also to increase domestic energy supply as quickly as possible. Rational energy pricing will help achieve both objectives even though it may seem difficult to attempt," he added.

On the issue of the rapidly increasing water stress that is being faced in various parts of the country, the Prime Minister said: "The total quantum of water available to the country is fixed. In order to ensure that we are not constrained by the availability of this precious natural resource, we will have to focus our energies on evolving a holistic water management policy aiming at more efficient conservation of water and also in water use efficiency particularly in the field of agriculture."

On the issue of land acquisition, Dr. Singh endorsed the argument put in the Approach Paper that a new legislation is necessary, which strikes an appropriate balance between the need for fair compensation to those whose land is acquired and whose livelihood is disrupted, and the need to ensure that land acquisition does not become an impossible impediment to meeting our needs for infrastructure development, industrial expansion and urbanisation.

On issues of health, education and skill development, Dr. Singh that the strategy of inclusive development pursued in the Eleventh Plan, would continue in the Twelfth Plan.

"We must ensure that these sectors receive adequate resources. However, the effectiveness with which these resources are used is also critical. We need to ensure that resources provided are spent to achieve maximum efficiency in terms of outcomes. We also need to harness private investment in these areas," he added. (ANI)