India must become a growth engine: PM

Says banking reforms, Aadhaar have helped his government make big strides and transformed the lives of the poor

Aiming high: Prime Minister Narendra Modi during the 52nd annual meeting of the African Development Bank in Gandhinagar on Tuesday.

The two most crucial factors for the Union government’s performance over the past three years have been banking reforms and Aadhaar, which has already yielded savings of $4 billion in cooking gas subsidies, Prime Minister Narendra Modi said here on Tuesday.

Mr. Modi expressed satisfaction over the improvement in “all macro-economic indicators” under his watch, but said he remained focussed on the many challenges that lay ahead to fulfil his aim of making India a global growth engine and an example of climate-friendly development.

“There are two crucial factors which have helped us,” said Mr. Modi in his inaugural address at the annual meeting of the African Development Bank. “The first set of changes is in the banking system … Our universal biometric identification system called Aadhaar has been the second crucial element. It prevents claiming of benefits by those who are not eligible,” Mr. Modi said.

The Jan Dhan Yojana helped India achieve universal banking and banks “normally associated with helping businesses and the rich” have been enlisted for helping the development of the poor, the Prime Minister said.

“We have strengthened our state-owned banks by freeing them from political decisions and appointing professional chief executives on merit through a transparent selection process,” he said at a venue just a stone’s throw from his previous office as Gujarat Chief Minister.

“The fiscal deficit, balance of payments deficit, and inflation are down. The GDP growth rate, foreign exchange reserves and public capital investment are up. At the same time, we have made big strides in development,” Mr. Modi said.

‘Focussed on challenges’

Thanking the Bank’s president Akinwumi Adesina for describing India’s recent steps as “as textbook chapters for other developing nations” and calling the country “a development beacon”, Mr. Modi said, “However, I must say that I remain focussed on the many challenges ahead … Our aim is that India must be an engine of growth as well as an example in climate friendly development in the years to come.”

While laying out the common challenges faced by both India and Africa, Mr. Modi indicated that his government’s priorities were “uplifting our farmers and the poor, empowering women, ensuring our rural communities have access to finance, and building infrastructure”.

“We have to do these within financial constraints. We have to maintain macro-economic stability so that inflation is controlled and our balance of payments is stable. There is much for us to gain by sharing our experiences on all these fronts,” he said adding that India learnt a lot from the mobile banking experience of countries such as Kenya in its push for a less-cash economy following the demonetisation of high-value currency notes.

“Here in India, I have launched an initiative to double farmers’ incomes by 2022. It will require concerted steps, ranging from improved seeds and optimal inputs, to reduced crop losses and better marketing infrastructure,” Prime Minister Modi said.