Prime Minister of India - Dr. Manmohan Singh

PM’s reply to the Lok Sabha debate on the President’s address

Madam Speaker, I rise to join all Members of this august House in conveying our sincere thanks to the Honourable President of India for her enlightening address. Over the past two days we have had a very constructive debate on the issues covered in the Rashtrapatiji’s Address.

 

 

While several Members have expressed satisfaction at the working of the Government, some others have criticized it. This is as it should be. Madam, before I come to the main subject, I would like to make a mention of the stampede that occurred yesterday at a temple in district Pratapgarh. The issue, I believe, had been raised by the concerned Member of Parliament in the Lok Sabha yesterday. I join all hon. Members in conveying our heartfelt condolences to the families of the deceased and wish speedy recovery to normal health of those who have suffered injuries. We have decided to make from the Prime Minister’s National Relief Fund an ex gratia payment of Rs. 2 lakh each to the next of kin of the deceased and Rs.50,000 to the seriously injured. Madam Speaker, the essence of the hon. President’s Address is contained in paragraph three, and I seek your indulgence to read that paragraph once again.

 

 

It says:

 

“My government was voted to office with a clear cut mandate to protect and deepen the values of pluralism and secularism, and to ensure rapid growth with justice and fairness for all. Since assuming office in May 2009, my government has worked single-mindedly to build on the achievements of its earlier term to deliver the promise of faster and more inclusive growth. The aam aadmi was and is at the core of this promise; the aam aadmi had to be protected against the ravages of the worst ever global economic crisis since the Great Depression and against the failure of the monsoon in large parts of the country in mid-2009.”

 

 

Madam, our economy’s performance has to be judged against the twin impacts of the international financial crisis which suddenly erupted in September, 2008 and then subsequently the failure of the south west monsoon in the year 2009. I sincerely believe that the way our Government has dealt with the impacts on our economy of these two adverse turns in our circumstances beyond our control is praiseworthy and indeed the whole world is praising India for the success with which we have achieved in this country.

 

 

Under the impact of the global economic crisis, the mighty countries of America and Europe have experienced negative growth rates. In 2008-09, India’s growth rate also declined but we still maintain a growth rate of 6.7 per cent. In the current year, we will have a growth rate of minimum of 7.2 per cent but possibly going up to 7.5 per cent.

 

In the fiscal year 2009-10, the growth rate of the economy will be probably close to, what I have mentioned, 7.5 per cent but the most conservative estimate is seven per cent. In the next fiscal year, we are confident of achieving a growth rate of eight per cent or more; and the year thereafter we will be able to return the economy to nine per cent growth rate.

 

 

Why do I emphasise the growth rate? Madam, growth is not an end in itself. The end is the well-being of our people. Growth is only a means to provide relief to those who are suffering; growth is a means to find resources to spend on education, on health, on rural development, on social security. If we do not grow fast enough, we may talk about removal of poverty, we may talk about expanding irrigation and other facilities in rural India but these will all remain pipe dreams.

 

 

The fact that the first three years of our Government saw a sharp increase in the growth rate, enabled our Government to devote a lot more resources for rural development, for agricultural development, for education. Therefore, it is very important that the economy should get back to the growth rate of nine per cent or more. I am confident that the macroeconomic fundamentals of our economy are very sound. Why do I say this? Ten years ago, nobody would have imagined that India’s savings and investment rates, can be as high as 35 per cent or 36 per cent. In the last four to five years, we have so managed the economy that both the savings and investments in our country now are equal to the savings and investment rates which prevailed until 10 years ago only in the countries of South East Asia or East Asia.

 

 

Moreover, I feel, in the years to come, in the next two decades, the dividend arising from the sharp rise in the working age population to total population of our country will provide another positive factor to push the savings rate of this country close to 40 per cent of our national income. If we manage our economy well, if we manage the creation of social and physical infrastructure well, if the processes of governance are improved to reduce the scope for corruption, I think, there is no barrier to India entering on a long-term basis the age of double digit growth. This is the vision that our Government is working to realise. I recognise that there are current problems, which cannot be wished away.

 

 

The hon. Members from both sides of the House have referred to the price situation. I will be the last one to say that the behaviour of food prices in the last one year is something which does not worry us. We have been worried about it a great deal and to the extent that we could adopt measures, we have adopted; and the House has my assurance that if any practical methods can further bring relief to our people, our Government will always be sensitive to the concerns of the aam aadmi… (Interruptions)

 

 

Madam, the crisis situation that emerged was a byproduct of events over which we had no control. There is, first, the effect of international commodity prices which have gone up and since India is no longer a closed economy, despite what Dr. Joshi may say, we are dependent on imports of substantial quantities of vegetable oils. In years of shortage, we depend upon import of sugar. We are dependent to a substantial extent on import of pulses. When international prices of these commodities rise, I think, there is inevitably an impact in our country. When international prices of rice and wheat go, if we do not pay remunerative prices to our farmers, our ability to procure for the Public Distribution System may be seriously in danger, and, therefore, we have to pay remunerative prices to our farmers but the side effect of that is, it raises the floor price or market determined prices.

 

 

I invite the House to reflect on a situation that we were faced with. There was the global recession. Simultaneously, because of the drought and because of the high commodity prices world wide, there was pressure on prices. We could have dealt with the price effect by a very tough monetary and fiscal policy which would have depressed the demand. Would that have been the course which the House would recommend to me? If we had gone that route, there would have been large scale unemployment and steep fall in industrial production in our country. At a time when the world is faced with a global economic crisis and declining rates of employment, we have so managed our economy that we have not allowed, I think, large scale unemployment to emerge as a problem in our country, despite the world wide recession that prevails.

 

 

At the same time we were able to introduce a large number of stimulus packages which ensured that the interests of the weaker sections of the society were protected. Take for example, the National Rural Employment Guarantee Scheme. Madam, 4.5 crores of households have benefited. Fifty per cent of them are women. Fifty per cent of them are Scheduled Castes and Scheduled Tribes. I am not saying that in one go or in one short period of five years, we can remove poverty. But if we are sincere, if we use all the resources of the economy to step up our growth rate, if we manage our fiscal situation well, we can certainly soften the harsh edges of extreme poverty in a period of about five more years.

 

 

We need to invest more in education. We need to invest more in health. We are doing that. We need to invest more in rural infrastructure and urban infrastructure. We are doing that. But more needs to be done. Please help us to strengthen the growth impulses in our economy so that we can accelerate the tempo of social and economic change. I have said growth is important not in itself, but because it provides us the resources to tackle the problems of poverty, ignorance and disease about which Jawaharlal Nehru spoke from the Central Hall of Parliament on the midnight of August 14, 1947.

 

 

Madam, many Members have in the discussion expressed their anxiety about rising prices. We had a separate discussion on this issue. But I would again like to inform this House that the Government has been alive to the problem and has taken all possible measures to address the issue. To put matters in perspective, it is important to recognise that in 2009 we had one of the most severe droughts in recent history, the worst since 1972. As a result, the production of food grains, pulses and oilseeds has been adversely affected. Production of sugarcane has also gone down. This was preceded by the economic slow down. To respond to this, the Government had to stimulate demand and increase the availability of bank credit.

 

 

We have taken decisive action on several fronts. We acted early to limit the fall in the Kharif production. As a result, we could contain the reduction in food grain production to a large extent. We have been able to procure around 23 million tonnes of rice this year which is not very different from what we had procured last year during the same time. There should be no panic on the food situation front considering the comfortable level of food stocks that are available with the Central Government. Rabi prospects are also very encouraging. Post-monsoon rains have been good. All this augurs well for our ability to stabilise food prices at a reasonable level. We have permitted import of raw and white sugar at zero duty and imports are taking place. Enforcement in terms of imposing stock and time limits is the hands of State Governments. We have empowered State Governments to do so through the Essential Commodities Act and I have requested the Chief Ministers to take stern action against hoarders.

 

 

Madam Speaker, many hon. Members have spoken about the export of sugar. Very often we have to honour prior international commitments. The amount of sugar that India has exported relative imports is so small that it is surprising that so much is being made out of this. In November 2009, India exported sugar worth Rs.7.94 crore whereas it imported sugar worth Rs.611.40 crore. In December 2009 the exports of sugar were worth Rs.12.34 crore whereas the imports were worth Rs.216.90 crore. From this, it will be obvious that the factors responsible for a sharp increase in sugar prices are to be found in the cyclical nature of production of sugarcane. There is a cycle which has been noticed for almost 50 years in the behaviour of sugarcane production. For two or three years in one cycle there is upward pressure on prices followed by a steep fall in prices. We have to find ways and means to stabilise the sugar economy despite this behaviour and we will explore ways and means to see that in future prices of sugar can be stabilised at reasonable levels unmindful of the cyclical nature of the production of sugar.

 

 

Madam, I now come to the internal security issues. The overall security situation in our country has remained satisfactory in the last year. This is not to ignore the horrible terrorist act in Pune. But taking an overall view of the internal security situation, what I am stating, I think, is what is the reality. A number of concrete steps have been taken to strengthen and reorient our security architecture in order to meet the growing threats of terrorism, insurgency and communalism. We have remained in close touch with State Governments to evolve a common and practical approach. We are taking firm action to curb naxalite violence. It is unfortunate that they are targeting innocent people and destroying roads, power lines and other essential infrastructure. In some places we have received reports of the use of children; we have drawn up an integrated plan to tackle the problem in consultation with the States. A high-level meeting was recently held with all the Chief Ministers where we reviewed the situation. The security forces have achieved several notable successes. While we are determined to take firm action, we are ready to talk to any group that abjures violence unconditionally and agrees to abide by the due constitutional process.

 

 

Madam, the National Investigation Agency has commenced its work. Four regional hubs of National Security Guard have been set up. We are in the process of setting up a National Counter-Terorrism Centre. A National Committee on Coastal Security has been set up which has adopted an integrated approach to coastal security and has taken major initiatives and decisions for registration of vessels, issue of identity cards to fishermen, installation of transponders on boats and setting up of four Joint Operation Centres. Coastal police stations and interceptor boats have become operational under the Coastal Security Scheme. To supplement the efforts of the State Government in modernising their police force, we have provided Rs. 1,250 crore during the current year of which Rs. 955.53 crore have been released to States up to 28th January this year. This has helped States to augmenting the resources available to police forces in terms of vehicles, weaponry, communications, training, forensic facilities, intelligence capabilities, security equipment and buildings. The Bureau of Police Research and Development is engaged in impact assessment study of the scheme so that the scheme could be improved.

 

 

Some hon. Members have said that agriculture has been growing at negative rates. This is indeed surprising. A drought is beyond anybody’s control. A severe drought does result in negative growth in agriculture and it is no surprise that agriculture is expected to grow at minus two per cent in 2009-2010. But we should not forget that in 2002-03, following the drought of 2002, agricultural growth went down by a good seven per cent. Food production went down from 202 million tonnes in 1998-99 to 174 million tonnes in 2002-03. I would also like to remind Members that the agricultural sector has been growing at an average rate of four per cent during the period 2005-2008 compared to the growth rate of around two per cent from 1997 to 2002. Our pro-farmer policies have borne fruit.

 

 

For the first time in the recent past, we have reversed the trend of declining investment in agriculture and stepped up investment in agriculture through the Accelerated Irrigation Benefit Programme, the Rashtriya Krishi Vikas Yojana, the National Food Security Mission, the National Horticulture Mission and other such schemes. We should also not forget the investment in water conservation structures that is being made through millions of works under the Mahatma Gandhi National Employment Guarantee Scheme. Food production has increased from 174 million tonnes in 2002-03 to 233 million tonnes in 2008-09, which represents a growth rate of around six per cent per year. We are, however, conscious that a lot more needs to be done to improve agricultural productivity and we are committed to continuing our efforts to increase both public and private investment in agriculture and diversify our agriculture so that higher farm incomes provide stability to the lives of our farmers. Dr. Joshi referred to our going to America to seek solutions to agricultural problems of our country. I wish to assure him that there is no scope for this sort of galatfahmi. I think, our Government recognises the imperative of food security and that self-sufficiency in basic food grains has to be a part of the National policy for development. This is a policy which we have pursued under successive Congress Governments way back from the sixties till date. We will continue to pursue it hereafter as well.

 

 

Madam, the decision to pay remunerative prices by way of minimum support prices is a part of our effort to incentivise growth of agricultural production and productivity. I think, Advaniji raised the issue of farmers’ suicide. Our Government has been very sensitive to the issue of farmers’ suicide and everything possible in terms of Government action is being done to ameliorate agrarian distress. The loans of small and marginal farmers have been waived and for other farmers, a one time settlement has been made. These measures have benefited 3.68 crore farmers to the extent of Rs. 70,000 crore. A special package for suicide-prone districts of Maharashtra, Andhra Pradesh, Karnataka and Kerala has been implemented. The minimum support prices of most agricultural commodities have been enhanced substantially over the last six years. It was ensured that fertiliser prices did not increase during the same period. We have, in fact, reduced the prices of complex fertilisers in 2008 in order to rationalise nutrient use. The increase in the Minimum Support Price of cotton has come as a great boon for cotton production in Vidharba and other cotton-growing regions of the country.

 

 

It has been said that the loan-waiver scheme has not helped farmers and it has only helped banks. … (Interruptions) Nothing can be farther from the truth. It is surprising that we forget that nearly Rs. 70,000 crore, that was recoverable from farmers, has not been recovered. It should also be borne in mind that owing to defaults in repayment, farmers would not be eligible for fresh credits. We have ensured the flow of fresh credit to the farm sector. During 2008-2009, against a target of Rs. 2,80,000 crore, the total credit flow to agriculture was Rs. 3,01,582 crore. During this year, we have a target of disbursing Rs. 3,25,000 crore and so far Rs. 2,18,202 crore have already gone to the agricultural sector.

 

 

We have accorded very high priority to the welfare of minorities. We have accepted most of the recommendations of the Sachar Committee and this House has been informed of the action taken on them. We have launched special programmes aimed at social, economic and educational development of minorities. Three new scholarship schemes have been started and are under implementation. We expect more than 40 lakh students to benefit from this scheme in the Eleventh Plan. At least 30 per cent of these students would be girls. Madam, the new 15- Point Programme aims to ensure that at least 15 per cent of benefits in certain schemes flow to minorities, and the schemes for minority welfare are being closely monitored. Under this programme, additional school rooms; drinking water supply schemes; Anganwadi centres; and houses are being constructed for the minorities. To improve the access of minorities to bank credit, we have set the target that at least 15 per cent of the priority sector lending will flow to them. During 2008-2009, more than Rs. 82,000 crore of bank credit, under priority sector lending, went to the minorities. This represents nearly 12 per cent of the total priority sector lending. We hope to improve on this in years to come. Minorities have not been represented adequately in Government services. We have taken steps to correct this situation, and as a result the share of minorities in Government jobs has increased over the past three years.

 

 

Madam, some Members have raised the issue of rights of tribals over forests. We are making genuine efforts together with the State Governments to ensure early disposal of claims and distribution of titles under the Scheduled Tribes and Other Traditional Forest Dwellers (Recognition of Forest Rights) Act. I have also requested the Chief Ministers of concerned States on three occasions to take all measures necessary to accelerate the process of implementation of the Act and to ensure expeditious distribution of title deeds to all eligible claimants. This was reiterated during the Conference of Chief Ministers and State Ministers held in November 2009 to review the implementation of the Act. The Ministry of Tribal Affairs is closely monitoring the progress in this regard.

 

 

Madam, some Members have expressed concern over the implementation of the National Rural Employment Guarantee Scheme. Let me say that this is a scheme, which has the potential to change the face of rural India. To improve its impact, we have initiated measures to bring in greater transparency and accountability. … (Interruptions)

 

An ombudsman scheme for setting up an independent grievance redressal mechanism at the district level has been formulated, and States are in the process of setting up district ombudsmen. Social Audits by Gram Sabhas have also been taken up. Details of job cards, muster rolls and works undertaken have also been placed in the public domain. A scheme for independent monitoring by eminent citizens has been formulated. Efforts will be made to continue to improve the implementation of this revolutionary scheme.

 

 

Madam, Advani Ji had raised the issue of black-money deposited in foreign countries. The Finance Minister had written to Shri Advani Ji in May, 2009, providing information about the action taken. Subsequently, we have moved further in the matter. Twenty countries and jurisdictions have been prioritized for entering into agreements regarding exchange of information and assistance in collection of taxes. Negotiations have been completed with the Bahamas and Bermuda, and steps are being taken for signing of agreements. We have also approached Switzerland for renegotiation of our tax treaty, so that we can have access to bank information. Negotiations were held in November, 2009, and the matter is being pursued for finalising a new protocol, through which we will be able to obtain information in specific cases. India is an active participant in global fora for improving transparency and exchange of information on tax matters.

 

 

Hon. Advani Ji had also raised the issue of ‘One Rank, One Pension’ to Ex- Servicemen. He has stated that the commitment I made in my last year’s Independence Day speech and Finance Minister’s promise in his Budget Speech of July 6, 2009, have not been honoured. This is not correct. The factual position is that we had constituted a Committee under the Cabinet Secretary to look into the issue of ‘One Rank, One Pension’ and other related matters. The Committee did not recommend ‘One Rank, One pension’. But whatever recommendations the Committee made to substantially enhance the pensionary benefits of personnel below officer rank and commissioned officers were accepted by the Government, and this is what I had stated in my Independence Day’s speech. The recommendations which have been accepted cover what the Finance Minister had promised in his Budget Speech of 2009. Of the seven recommendations that the Committee made, five have been implemented. The two recommendations which have not been implemented will be implemented very soon.

 

 

Madam, I share the concern of hon. Members about the need for electoral reforms. I do not think there is any dispute regarding the need for electoral reforms. Unfortunately, we do not have the same degree of unanimity on the manner in which to go about it. It has been our accepted position and also the accepted position of previous Governments that electoral reforms should be brought about only by broad-based political consensus. The recommendations of the Election Commission regarding electoral reforms and other proposals received by us are presently under consideration of the Standing Committee of Parliament. Therefore, the Committee would be able to recommend measures which should find support in this House across the political spectrum.

 

 

We introduced the Women’s Reservation Bill in the Rajya Sabha in May 2008. We have already considered the Report of the Standing Committee of Parliament on this Bill. It will be our endeavour to bring the Bill before Parliament in this very session. I sincerely hope that hon. Members would support the Bill as it would be the strongest affirmation of our commitment to the empowerment of women.

 

 

I should say a few words about foreign policy. The Government’s foreign policy has been based on national consensus and full adherence to the principles and objectives laid down by the founding fathers of our Constitution. The foreign policy that we have pursued in the first term of our Government and on which we have built upon in the second term has yielded solid dividends. India’s standing in the comity of nations has never been higher. In the troubled world that we live in, there is respect for India’s role as a force of moderation, reason and stability. The resilience of our democracy, our commitment to pluralism and secularism and the strength of our economy have enhanced our standing in the world.… (Interruptions) The situation in our neighbourhood is a matter of high priority for us. We have had very intense and substantive interactions with our neighbours in the last nine months.

 

 

Several Members have voiced their concerns over the situation in Pakistan and the terrorism that is emanating from there against India. The Government fully shares these concerns. We are taking all necessary steps to strengthen our internal security and defence capabilities. Government has kept Parliament fully informed at every stage of our policy towards Pakistan. I had made a detailed statement on our approach towards

 

Pakistan in this august House on 29th July, 2009. The External Affairs Minister briefed the House on the last round of Foreign Secretary level talks in February. Our policy towards Pakistan is consistent, cautious and realistic. I have never believed that the channels of communication with Pakistan should break down. Even at the height of the cold war, the Americans and the Soviets used to speak to each other. The chances of miscalculation can only increase in an environment of no contact. I therefore, personally conveyed our concerns to President Zardari when I met him in Russia and later to Prime Minister Gilani at the NAM Summit last year. I had made an offer of talks on humanitarian and other issues in October last year during my visit to Anantnag. The decision to resume talks at the Foreign Secretary level is not a sudden decision but a calculated one based on weighing all the costs and benefits. The fact of the matter is that the rest of the international community is talking to Pakistan. So, our not talking to them is not going to isolate them. We have made our point strongly, but we cannot wish away the problem by not talking to them. Dialogue is the only way forward for civilized countries to resolve their problems. But it is equally true that for any meaningful dialogue to proceed, the terror machine has to be controlled by Pakistan even if non-state actors are at work. I have said so in Parliament a number of times and that remains our consistent position. We have left Pakistan in no doubt about our concerns and our expectations with regard to the actions. Pakistan must take against the terrorist groups operating on Pakistani soil and targeting India. Pakistan must fulfil its assurances that it will not permit any territory under its control to be used to support terrorism in any manner.

 

 

Madam, some hon. Members have referred to my discussions in Saudi Arabia on Pakistan. Saudi Arabia is also affected by terrorism and this was one of the subjects that came up in our discussions. I discussed India-Pakistan ties in this context. I mentioned to the Saudi leadership, as I have to other world leaders as well, that all problems between India and Pakistan can be resolved through meaningful bilateral dialogue, if only Pakistan could be urged to take a reasonable attitude in dealing with those terrorist elements who target our country. I wish to reaffirm that no offer was made seeking mediation. We do not need any mediation. We are talking directly to Pakistan.

 

 

Advaniji said that we acted under US pressure. (Interruptions) …∗

 

Madam, I think we do a disservice to any Government and Prime Minister of this proud country, if we say that such fundamental matters of national security and foreign policy are based on anything but our supreme national interest. I have had many discussions with President Obama since he took office. I categorically state that not once has he sought to pressurize India into taking one position or the other. On the contrary, he has always expressed understanding of the positions we have taken from time to time. I would urge the Opposition not to spread disinformation on sensitive aspects of our foreign policy. Let me say, Madam, that we do not wish to see the involvement of foreign powers in South Asia. Whatever our problems, we must learn to talk to each other and to solve our problems in a peaceful manner using our own creative genius.

 

 

Madam, in Afghanistan our assistance has received widespread support among the people of Afghanistan. The entire nation was outraged by the most recent brutal attack in Kabul on February 26, which has led to the loss of seven innocent Indian lives. These Indian nationals were in Afghanistan on a mission of goodwill and friendship helping to construct the peaceful and democratic Afghanistan that our Afghan friends desire. We condemn this cowardly act. I wish to assure this House that such attacks will not bend the will of the people of India. President Karzai had telephoned me and I have requested him to ensure the safety of all Indians. I assured him of any support and assistance that may be required. We are closely monitoring the developments with regard to Afghanistan and we will assist the people of Afghanistan in securing their legitimate right to determine their destiny in the manner they choose without outside interference.

 

 

Madam, Joshi ji made some comments about India-China relations. Let me say, China is our important neighbour, with whom we have a comprehensive and multi-sectoral relationship. We wish to build upon the achievements so far so as to create a partnership that is mutually beneficial. We are convinced that good relations with China are in the interests of both countries, and will contribute to peace, security and stability not only of the Asia-Pacific region but also of the world. We are both committed at the highest level to maintain peace and tranquility on the border, pending the resolution of the border question. This is a complex matter which will take time to resolve. I had an excellent interaction with Prime Minister, Wen Jiabao in Copenhagen, and our cooperation in the area of climate change is a shining example how our two countries can work together on issues of global importance and those which impinge on the future of our two peoples.

 

 

In Sri Lanka, the conclusion of military operations against the LTTE has opened opportunities for finding such a lasting political settlement which will be acceptable to all communities, particularly the Tamils, within a united Sri Lanka. We have and we will continue to contribute to the humanitarian and rehabilitation efforts of the Sri Lankan Government, and to the long-term reconstruction of areas that have been affected by the military conflict. Our assistance package of Rs.500 crore for immediate relief, resettlement and reconstruction is under implementation.

 

 

We have taken several steps to diversify and broad-base our relations with Bangladesh. A major milestone in this respect was the visit of Prime Minister, Sheikh Hasina to India in January 2010. During that visit we put in place a comprehensive framework of cooperation for development of our relations, which includes a renewed commitment by both sides to actively cooperate on security issues. We have provided a line of credit of one billion US dollars for a range of projects in Bangladesh which we intend to follow up vigorously. The Government of Bangladesh has reassured us that they will not allow their territory to be used for activities inimical to India. We have welcomed some of the steps they have recently taken in this direction.

 

 

Our country is passing through a difficult time. Security and stability are the need of the hour. Political parties can differ on various issues but I do believe it is important for us to face challenges in a united manner. I seek the cooperation and support of all sections of this House. Let us not allow narrow partisan considerations to come in the way of effective governance of this great country. The people of India expect both the Treasury and Opposition benches to engage constructively and ensure safety, security and prosperity for our citizens.

 

Thank You.