Prime Minister of India - Dr. Manmohan Singh

Excerpts of PM's Closing Remarks at the National Development Council (NDC) meeting

Since yesterday, we have had a very fruitful exchange of opinions on the issues that have been covered in the Mid Term Appraisal of the Tenth Five Year Plan. From the tenor of our discussions, I believe that there is broad agreement with the goals and policies suggested in the Mid Term Appraisal and that it can act as a blue-print for further action on development matters in the Tenth Plan. It can also act as the starting point for initiating work on the Eleventh Five Year Plan. During the course of our discussions, a number of very valuable suggestions were made by Chief Ministers which may require a review of some of our policies, programmes and approaches. I am certain that the Planning Commission has taken note of these suggestions and will act on them in the coming months.

Today, India is at a historic point in its development trajectory. As I said in my opening remarks yesterday, we are now at a point in time where we can deliver growth at a rate of 7% - 8%. At this point in time, owing to the developments over the last two decades, there are no external constraints to the growth of our country. It is very much in the realm of possibility for this country to become a prosperous nation, rid of the perennial scourges of poverty, ignorance and disease. The world is today looking at India with great interest as the saga of our development and rise to prominence on the international stage unfolds. Rare are such moments in history when a nation suddenly captures the imagination of the world.

In such circumstances, if there are any constraints, these are purely internal. Our success in living up to our potential depends solely only on us. No external force can be blamed if we do not rise up to everyone's expectations. Therefore, it is incumbent on all of us in this august gathering to ensure that we realize this potential. It is this vision of a resurgent India that must guide our actions while discharging our duties.

As I had said earlier, the environment for India's development has never been as favourable as it is now. The challenge before us is to combine the economics of growth with the economics of equity and social justice. We have no option but to walk on two legs. On one hand, pursuing policies that unleash the creativity and enterprise inherent in our people, that reward excellence and risk-taking; and on the other, addressing the needs of every citizen, their right to a decent livelihood, to education and well-being, to equality of opportunity, and to peace and security. We need to ensure that while sustaining the growth impulses, deliberate efforts are also made to reduce disparities in income and wealth, to ensure that all sections of society participate in and benefit from growth. We need to survive and flourish in the increasingly integrated and globalised world we are living in.

The NDC is a political body and that is its strength. Here we are gathered in this room, representing a diverse set of political backgrounds, views and ideologies. However, we are all, I believe, in agreement that economic development and the prosperity of every citizen is a collective national goal. Over the last two days, I have heard this resonate from every speaker and it is heartening that political differences will not come in the way of achieving our common objective of building a prosperous, inclusive, equitable, humane, caring and just India.

While we have noted each and every suggestion made by the Chief Ministers and will take due note of them, I would like to dwell on a few of them. A number of Chief Ministers have expressed concern about issues relating to state finances, particularly the effect of the recommendations of the XII Finance Commission, the level of permissible market borrowings, and interest costs on borrowings. Some have raised issues related to mineral royalties and externally aided projects. The Finance Minister, in his intervention, has touched upon these and I believe that he will work to allay any apprehensions that may exist. Healthy state finances are as important as healthy central finances and fiscal prudence and stability must be our joint endeavour.

Agriculture and irrigation have indeed been a common priority in all the Chief Ministers' interventions and rightly so. Rejuvenating our agricultural credit system, providing some measure of relief to farmers, improving the quality of our extension work, attending to the specific needs and problems of drylands and wastelands and enhancing investments in irrigation have emerged as common concerns. Given the importance of this sector, I believe that we could give focused attention to this subject by constituting a sub-Committee of the NDC, which could submit its reports within the next six months for inclusion in the Approach Paper to the Eleventh Five Year Plan. I propose, therefore, that we agree to the formation of a sub-Committee of the NDC for drawing up implementable action plans in agriculture and related issues. With your approval, I will constitute this sub-Committee immediately with the Agriculture Minister Mr. Sharad Pawar as Chairman so that the work can begin in right earnest and we can benefit from their wisdom while framing the Eleventh Plan.

On the Employment Guarantee Act, there have been suggestions that payment of wages should be mostly in cash since there are problems in movement of food grains to backward areas and that being a self targeting programme, the Employment Guarantee should cover non-BPL families. Both these observations have merit and will be considered for inclusion in the final draft of the National Employment Guarantee Bill.

Most Chief Ministers have strongly supported Watershed Development Programmes and have desired that the outlays should be significantly increased and that such programmes should be brought under one Ministry in the Centre to avoid duplication. There was specific mention of developing a well-articulated strategy for dry land agriculture. Some have suggested specific measures for more backward regions of the country, particularly the North Eastern states and Jammu & Kashmir.

We will make every effort to ensure that these suggestions are taken on board and implemented.

Many Chief Ministers have either demanded transfer of Centrally Sponsored Schemes or their amalgamation into four or five broad heads with freedom to develop locally relevant programmes. We may consider setting up an Expert Group to develop concrete proposals for restructuring the Centrally Sponsored Schemes.

There has also been repeated mention of providing adequate flexibility in the design of programmes such as the Sarva Shiksha Abhiyan, the National Rural Health Mission and the Bharat Nirman to account for state level realities and priorities. Some Chief Minisers have sought to strengthen block level implementation capabilities. These concerns would be considered by the Planning Commission and the respective Ministries so that local priorities find space in these programmes. What I have heard since yesterday gives me hope that investment in social infrastructure is a priority for all states and with our collective will and leadership, we will be able to improve our social indicators in a short time frame.

Improvement in physical infrastructure has also emerged as a common priority. While infrastructure has traditionally been seen as a responsibility of the government, it is gradually seeing increased private participation. This is necessary because the resources needed to achieve the infrastructure expansion and upgradation we need are simply not available in the public sector. It also helps to achieve higher standards of service delivery. However, successful promotion of private participation in infrastructure requires a well designed framework of policy in which investors have the assurance that standards of service will be maintained and concessions will be transparently awarded. The central government is working towards evolving such a framework. We will also facilitate state governments in their efforts in this regard through enhanced capacities, both physical and financial. The power sector, which is absolutely critical for economic growth will, I hope, receive priority attention in all states. Healthy electricity agencies are the lifeblood of a thriving economy and much still needs to be done to strengthen their operations.

Finally, let me add an aspect that has been concerning us. Much of our discussion on development tends to focus on government programmes and understandably, there is a general desire that these programmes should be expanded. In many of the areas we have discussed, we do indeed need to expand the scale of activity. But I must emphasise that expansion of outlays without regard to outcomes does not contribute to development. In the central government, we propose to strengthen the mechanism for monitoring and evaluating performance so that we can be sure that our expenditures achieve their stated objectives. I would urge the state governments to take parallel steps on their part as well.

I would like, at this stage, to compliment the Planning Commission for the effort that has gone into the preparation of the Mid Term Appraisal. It is not only the result of sustained effort and thinking, but also contains the basic elements of a roadmap for putting our economic development on a higher trajectory in the coming years. I commend the Commission for its effort and direct it to begin work on the Approach to the Eleventh Five Year Plan with a view to submitting it for NDC's approval by the end of December this year.

Friends,

We have stood tall as a Nation because of the fact that we are the world's most successfully functioning multi-cultural, multi-ethnic, multi-lingual, multi-religious democracy. There is no precedent elsewhere, in the history of the world, where a billion people are trying to realise their destiny in the framework of an open society and an open economy. The collective political leadership of all of you is, I am certain, capable of leading India's drive in this century to be rid of poverty and disease, to be prosperous and equitable and to make the 21st century India's century. I appeal to all to make this happen.