Onus of spurring investments on states: Montek

A day after the government spoke of taking measures to perk up investments, the Planning Commission on Tuesday said states could play a big role in improving the country’s investment climate, as a large number of policy matters fell in their domain.

“In the (current) 12th Plan (2012-17), we want to focus on what are the central government’s responsibilities in policies and what are the ones that are pretty firmly in the hands of the states. The number is quite large,” Planning Commission deputy chairman Montek Singh Ahluwalia said here.

Addressing an industry chamber, he listed a number of areas where states could play a big role to improve the overall investment climate. These included power, land, labour, state levies administration, roads, agriculture marketing and linkage and water.

“A very large part of what would constitute a good investment climate depends entirely on state governments,” Ahluwalia said while addressing CII’s annual general meeting here.

Earlier in the day, minister of state for commerce and industry Jyotiraditya Scindia voiced a similar opinion. “The Centre can create a mechanism for industrial growth, but the states have to be more active in executing that,” he said.

Ahluwalia, while emphasising that the role of states in fuelling the growth of the national economy has become very significant over the past few years, suggested to bring out a survey ‘Ease of Doing Business’ for each state. it would encourage competitiveness amongst them.

He was of the view the survey should also bring out successful experiments carried out at states’ level for adoption by others. Also, it was not true that the economic reforms have benefited only financially sound states, he claimed.

“Many people used to say that economic reforms will only benefit well-off states and that the backward ones would not benefit... This is not true,” he added.