Plan panel puts reality check on 10% GDP target

A 10 per cent growth rate in the gross domestic product (GDP) in a few years from now will need several corrective steps, the Planning Commission has said.

These include addressing inadequacies in sectors like agriculture, services, manufacturing, human resource, and competitiveness in trade, it has said in the approach paper to the 11th Plan.

A major challenge is to reverse the deceleration in agricultural growth from 3.2 per cent, observed between 1980 and 1996-97, to an average of around 2 per cent, it has said. It feels that a second Green Revolution is urgently needed to raise the growth of agricultural GDP to 4 per cent.

"The challenge posed is to at least double the rate of agricultural growth and to recognise the increasing role of women," the paper says.

In 2004-05, women accounted for 34 per cent of principal and 89 per cent of subsidiary workers in agriculture.

While growth in agricultural GDP will improve rural employment, the plan panel believes that to absorb all new entrants into the labour force, non-agricultural employment needs to increase at over 6 per cent per annum during the 11th Plan period.

The commission is also concerned about the need to increase manufacturing competitiveness, which has accelerated in comparison with the 9th Plan but is unlikely to exceed 8 per cent in the current Plan period.

Stating that India cannot afford to neglect manufacturing, the paper has said that a major constraint in achieving faster growth in this area is the inadequacy of physical infrastructure.

"This gap must be filled within 5-10 years and development in infrastructure must, therefore, be accorded high priority in the 11th Plan," the paper says.

Mentioning the rich dividends accruing from the earlier emphasis on quality higher education, the paper calls for expanding capacities in higher learning through private sector initiatives.

The panel has also advocated a policy for compensation, proper resettlement, and rehabilitation of people displaced because of development projects, conflicts or calamities. It has also called for changes in the legal system.