Controlling price rise top priority; corruption an obstacle

New Delhi, Aug 15 (PTI) Assuring the nation that the
government will consider new steps to arrest price rise,
Indian Prime Minister Manmohan Singh Monday said persisting
high inflation and corruption are major challenges before the
Indian economy.
"We are continuously monitoring the situation (on
inflation) ... Finding a solution to this problem will be our
top-most priority in the coming months," Singh said in his
Independence Day address to the nation.
The Reserve Bank of India (RBI), in sync with government,
has taken steps, like tightening of monetary policy, to rein
in rising prices. But, Singh said, "We have been confronted
with a situation in which the reasons for rising prices lay
outside the country."
The prices of petroleum products, foodgrains and edible
oil have gone up steeply in international markets in recent
times. Both food and general inflation have remained
stubbornly high and are near the double digit marks.
In the backdrop of apprehensions of policy paralysis and
slowdown in reforms expressed by the industry, the Prime
Minister said, "We should all stay away from politics that
create suspicion or apprehension amongst those connected with
industry, business and investment."
Admitting that corruption is coming in the way of India
achieving its aspirational goals, he said, "Today, the world
recognises our potential to be one of the major economic
powers globally. But the problem of corruption is a big
obstacle in such a transformation."
Singh said while India had successfully handled the global
financial crisis of 2008, the "road ahead is long and ardous
...The world economy is slowing down. The developed countries,
especially America and countries of western Europe are facing
economic problems...All this can have negative impact on
us.But we will not let this happen."
Singh said that while the country is going through rapid
economic growth, "we should build an environment in which the
energy and enthusiasm of the people are chanellised into
activities of nation building.
"Our entrepreneurs and businessmen should not feel
constrained in their activities. Our industrialists should
have the opportunity to set up new industries so that our
youth can get new avenues for productive employment."
About the nagging inflation, he said the situation can be
tackled by increasing supply of essential commodities, and
complemented farmers for India's record foodgrain production.
According to fourth advance estimates, the country has
achieved a record 241.56 million tonnes of foodgrains
production during 2010-11 crop year (July-June).
"I congratulate the country's farmers for their
achievement this year... Wheat, maize, pulses and oilseeds
have all seen record levels of production...Today there are
proposals for export of foodgrains, sugar and cotton," he
said.
He assured the people worst affected by price rise that
the government will soon enact a legislation for providing
food security to them.
For ensuring transparency in the public procurement, the
government is planning to introduce a Bill in Parliament by
the end of this year to lay down principles in regard to state
purchases.
Singh also assured farmers that the government would
continue to take care of their needs, especially with regard
to easy access to fertilisers, seeds and credit.
The government provided Rs 4,26,531 crore during 2010-11
as farm credit against the target of Rs 3,75,000 crore. For
this year, the target has been set at Rs 4,75,000 crore.
The interest rates on farm loans for those farmers who
pay their dues in time has also been reduced to 4 per cent
from this fiscal as against 5 per cent.
India imports over 10 million tonnes of fertilizers every
fiscal to meet the shortfall in domestic demand and therefore
subjected to fluctuations in global prices.
The government has been strengthening the physical
infrastructure like airports, roads and ports, Singh said,
asserting that in the 12th Plan, investment in these sectors
would be further accelerated.
According to a Plan document, India wants to invest a
huge USD 1 trillion in the infrastructure in the next
Plan.
The Prime Minister also said the government is planning a
law to monitor the functioning of the regulatory bodies and
hold them accountable.
"In recent years, we have established independent
regulatory authorities in many areas. These authorities
discharge many responsibilities which were earlier in the
domain of the government itself."
He said, at present, there is no legislation to enable
monitoring of work of the regulatory authorities and make them
accountable.
"We are also considering enactment of such a law," he
said.