Tough decisions needed to achieve 9% growth in 12th Plan: PM

New
Delhi, Aug 20 (PTI) Amid global economic uncertainty, Indian Prime Minister
Manmohan Singh on Saturday said the government will have to take "difficult
decisions" to achieve 9 per cent growth rate in the 12th Five-Year Plan
(2012-17), up from 8.2 per cent estimated for the current Plan. "...
9 per cent target (in 12th Plan) is feasible only if we can take some
difficult decisions," Singh said in his opening remarks at the meeting of
the full Planning Commission here. The meeting has been called to
approve the Approach Paper for the 12th Five-Year Plan. The Prime
Minister also underlined the need to focus on implementation and governance
to improve effectiveness of the flagship programmes aimed at promoting
inclusive growth. "These (flagship) programmes will continue in the
12th Plan, but as the (Approach) paper rightly emphasises, we need to focus
on issues of implementation and governance to improve their effectiveness."
The Prime Minister also made a case for stepping up agriculture sector
growth rate to 4 per cent during the next Plan saying it is necessary to
avoid inflationary pressure and improve rural income. India was
growing by over 9 per cent before the global financial crisis in 2008 pulled
down the economic growth to 6.8 per cent in 2008-09. The economy is
likely to grow expand by 8 per cent during 2010-11.

The agriculture sector is estimated to grow by 3.3 per
cent during the current Plan period (2007-12).
"I am happy to inform members that although the Approach
Paper talks of achieving 3 per cent agricultural growth in the
Eleventh Plan ... the latest estimates suggest that this will
be 3.3 per cent," Singh said.
Agriculture contributes about 14-15 per cent to the
country's gross domestic product (GDP).
The Commission had examined the range of 9-9.5 per cent
for economic growth during the 12th Plan and it proposed that
the government should set the target at 9 per cent.
Singh further said that achieving 9 per cent growth will
require large investments in the infrastructure sector.
The global markets are in a tailspin amid concerns over
euro zone debt troubles and their impact on banks, weak
economic data in the US and other parts of the world.
On the domestic front, while high inflation is the
biggest concern for the government, the industry has expressed
worries over rising interest rates.
The Approach Paper notes that India was "fairly
successful" during the 11th 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," Singh said.

Noting that land acquisition has become "highly
controversial", Singh said the Approach Paper rightly argues
that a new legislation is required to deal with the situation.
The Paper points out that the new legislation should
strikes a balance between the need for fair compensation, and
the need to ensure that land acquisition does not become an
"impossible impediment" to meet the needs for infrastructure
development, industrial expansion and urbanisation.
The Prime Minister said that health, education and skill
development were key areas of the strategy of inclusive
development in the current Plan and they will continue to be
focus areas in the next as well.
Singh said the Plan panel has rightly endorsed the
importance of the process of fiscal correction announced by
the government, even if this means that total resources
available for the Plan in the short run will be limited.
"Resource limitations imply the need to priorities
carefully. Some priority areas, e.g., health, education and
infrastructure will have to be funded more than others," he
said.