Reforms have reduced poverty, says PM

Prime Minister Manmohan Singh today said economic reforms have helped reduce poverty in the country but admitted the rate of decline should have been faster.

“As far as poverty is concerned, the facts are quite clear. The percentage of the population living below the poverty line has certainly not increased. In fact, it has continued to decline after the economic reforms at least at the same rate as did before,” Singh said in his address at the 92nd conference of the Indian Economic Association here.

“Based on the available evidence, we can claim that there is no evidence that the new economic policies have had an adverse effect on the poor. However, I would readily agree that what has been achieved is not enough and the decline in poverty should have been faster than what we have experienced,” he added.

The prime minister pointed out that all the discussion on trends in poverty have been based on the National Sample Survey (NSS) data and the latest large sample estimate of the NSS was available only for 2004-05.

Since the period of rapid economic growth was largely after 2004-05, we would have to wait for a year or two to know its impact on poverty, he said.

“If we consider the post-1991 phase, the average growth rate of the Indian economy between 1992-93 and 2009-10 has been 6.8 per cent, he stated.

The prime minister said the country’s economy was likely to grow by 7 per cent or a little more in the current financial year (2009-10).

“The momentum of the Indian economy was interrupted by the global economic crisis in 2008 and we slowed to 6.7 per cent in 2008-09. We are likely to achieve 7 per cent growth or a little more in 2009-10,” Singh said.

The prime minister’s comments come on the heels of a growth forecast in the range of 7.5-8 per cent made by Finance Minister Pranab Mukherjee.

Stating that poverty was a major challenge for the country, Singh stressed on faster economic growth and creation of new job opportunities to tackle the problem. To achieve inclusive growth, the country needed to pay more attention on education, health care and rural development, particularly on the needs of the poor, he said.

“Special attention has to be paid to increase agricultural productivity, particularly of the small and marginal farmers. In industry, more systematic efforts have to be made to help small firms in mobilising resources for their growth,” he added.

The PM also touched upon the issue of global climate change, saying it was a big challenge for countries. An optimal solution to this challenge was only possible if the world could find ways to reach a mutually satisfactory solution, he opined.

Scale up spend on science and technology
India needs to scale up its spending on science and technology from the current one per cent of gross domestic product (GDP), according to Singh.

“The expenditure on science and technology is 1 per cent of GDP, which is about half the level of the developed countries. The Centre is committed to increase the funding for research and development, and for the last few years, we have been allocating larger funds in this area,” he said.

Singh also called for greater efforts from private players in improving research and development (R&D) facilities.

“I expect the private sector to do more for R&D. We also need more public-private partnership in R&D in all the areas of science and technology,” he asserted.The PM today laid the foundation stone for a new campus of the National Institute for Science Education and Research (Niser) at Jatani, 20 km from the city.

Among those present were the state’s Governor M C Bhandare, Chief Minister Naveen Patnaik, Niser chairman Anil Kakodkar, and Srikumar Banerjee, secretary of the Department of Atomic Energy.