Prime Minister Manmohan Singh on Tuesday said the effects of the global meltdown had begun to wear out and asserted that UPA II was in a commanding position to tackle drought. Terming the pessimism about the economy unwarranted, Dr. Singh, chairing the first full fledged meeting of the Planning Commission in his second tenure here, said: “We are in a very strong position to manage the consequence of drought. Our food stocks in particular are very high. We should not be over-pessimistic.” The country had a buffer stock of 50 million tonnes of foodgrains, enough to meet the requirements of the Public Distribution System for 13 months.
Underlying strengths
While the economy had to deal with the lingering effects of the global slowdown and the impact of drought, it also had underlying strengths built over the years. The government’s focus now was on drought management including protecting the kharif crop and ensuring a normal rabi crop. “The government is giving focussed attention to all aspects of drought management, including relief measures. The NREGA [National Rural Employment Guarantee Act] gives us a very important instrument for supporting incomes of those most in need. We must make all efforts to converge NREGA and other agricultural and rural schemes to minimise the impact of drought during 2009-10.”
Revival of investment
Indicating a recasting of public-private partnership norms, especially in infrastructure, to revive investment, Dr. Singh said: “The progress in the implementation of PPP projects has been less than what we would have wanted. We are taking steps to streamline the process so that PPP projects can move faster.” He also underlined the need for expanding the scope of PPP to include projects in the social sectors such as health, education and urban development. Dr. Singh suggested that the Planning Commission interact with the Ministries concerned to exploit the opportunity for PPP but, he cautioned, any initiative must not weaken the commitment to inclusiveness. “We have to ensure that the momentum of planned development is maintained in the next two years [of the 11th Plan] and that our flagship programmes are fully funded.”
Capital flow
The global meltdown had constrained resource mobilisation and capital flows to developing economies, hitting investments — key to economic growth. As a result, India’s economic growth slipped to 6.7 per cent in 2008-09 from about nine per cent the previous fiscal. The Commission expected that it would fall to 6.3 per cent in 2009-10. “We have been through a difficult year because of the global economic downturn which is only now coming to an end with a slow return to normalcy in the months that lie ahead,” Dr. Singh said. On the Integrated Energy Policy, the Prime Minister said rational energy policies were also critical for rational responses to the threat of climate change. “This is a new compulsion and we need to assess whether we are on track in critical aspects of our energy policies.”
