Politics hurting business: PM
Singh says reforms as important as national security, commits to 6.5%-plus growth this year
Prime Minister Manmohan Singh on Wednesday said India must treat measures to boost economic growth as a matter of national security and blamed a lack of political consensus for the failure to provide a friendlier investment environment.
Addressing the nation on Independence Day, Singh said urgent steps were required to shield the Indian economy from the impact of the global economic slowdown. However, that would require creating an environment which the government “is not being able to achieve because of a lack of political consensus on many issues. Time has now come to view the issues which affect our development process as matters of national security,” Singh said.
However, he committed India to achieving a rate of economic growth for the year that would be “a little better than” 6.5 per cent. That, he said, was still better than Europe, estimated to grow at zero per cent for the year. Conceding that domestic developments had hindered growth, the PM said there wasn’t much India could do about external conditions but “we must make every effort to resolve the problems inside our country so that our economic growth and the creation of employment opportunities in the country are again speeded up”.
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To encourage investment, Singh said “the government will take steps to increase investment for infrastructure development with the help of the private sector. To attract foreign capital, we will have to create confidence at the international level that there are no barriers to investment in India”.
Barring a scheme for housing loans at low interest rates for the poor, Rajiv Housing Loan Scheme, where loans below Rs 5 lakh would attract a low rate of interest (mentioned in the 2012-13 Budget but yet to be operationalised), the PM announced no new schemes. He, instead, warned India should prepare itself to meet serious challenges ahead. These included controlling inflation, which he said could be exacerbated by a bad monsoon.
Referring to diesel and seed subsidy for farmers and measures to make fodder available in districts that recorded a 50 per cent deficit in rainfall, the PM said hard work by farmers in past years had ensured India would face no shortage of food grain. He referred approvingly to the mid-day meals scheme (the biggest children’s feeding scheme in the world) and the Mahtama Gandhi National Rural Employment Guarantees Scheme but announced no additions.
A National Skill Development Authority would be created, he said, so that skill development programmes all over the country could be coordinated.
While making the obligatory references to the armed forces, the PM promised the recommendations of a committee to align the pay and pensions of various ranks would be acted upon “promptly”. On the corruption debate, the PM said, “We will continue efforts to bring more transparency and accountability in the work of public servants and to reduce corruption. But we will also take care that these measures do not result in a situation in which the morale of public functionaries taking decisions in public interest gets affected because of baseless allegations and unnecessary litigation.”