Tough measures call of the hour, says Montek

8.2% growth in 2003-04 not a one-off affair: Plan Panel chief

The new Planning Commission Deputy Chairman, Montek Singh Ahluwalia, dismissed the 8.2 per cent growth in 2003-04 as a one year phenomenon.

Briefing reporters after taking charge at Yojana Bhawan, Ahluwalia said hard decisions would be needed to push the economy's growth to the 7-8 per cent range.

The government would have to focus on agriculture, health, education and infrastructure to improve the economic health of the country.

He said that the economy had grown at an average rate of less than 6 per cent over the last few years. "The 7-8 per cent growth target set out in the Common Minimum Programme (CMP) is achievable, but not without policy changes," he told reporters.

Refusing to elaborate on the gross budgetary support the Planning Commission was likely to be given to improve performance in the focus sectors, Ahluwalia said avenues for raising money would have to be identified.

In infrastructure-related sectors, where the government could opt for public-private partnerships, the policy framework put in place by the previous government was not conducive to maximising private investment, said Ahluwalia, who had served as a member in the previous Planning Commission headed by KC Pant.

The NDA government had also not paid adequate attention to the agri, health and education sectors, which were critical to raising the overall growth rate of the economy, he added.

"Steps taken so far have not been adequate," he said adding that the government would have to continue investing in areas like rural infrastructure where the private sector was unlikely to step in.

Calling for a revamp of agricultural policies, the Deputy Chairman said the slowdown in agricultural growth over the last five years was a matter of grave concern.

Policies would have to be reconstructed to enable agriculture to grow at 4 per cent annually, against 2.7 per cent now. Without reversing this trend, it would not be possible to raise growth rates or reduce poverty levels, he said.

The Prime Minister had directed the Planning Commission to give high priority to devising implementable ways of achieving the objectives laid out in the CMP and the upcoming mid-term review of the Tenth Five-Year Plan would be used to see how these objectives could be achieved, Ahluwalia said. The Plan body would also focus on ways of providing effective service delivery and evaluating programmes.

Refuting arguments on the irrelevance of the Planning Commission in an increasingly liberalised economy, Ahluwalia said in addition to being a policy making body, it was also the principal forum in the government, which interacted with the Centre and states to decide on the size of development programmes, their sectoral allocation and the institutional route for their delivery.

Also, as the only body in the government which took a cross-ministerial view, it could not be dismissed as unimportant. Four of the seven newly appointed members, Balchandra Mungekar, Abhijit Sen, Syeda Hamid, Anwar-ul Hoda were present today.