NDC-PM-LD ECONOMY 2LST

India's economic growth slowed during 2008-09 to 6.7 per
cent from over nine per cent since 2005-06 due to the global
financial crisis. However, stimulus packages to boost demand
pushed it up to 7.4 per cent last fiscal. It is expected to be
8.5 per cent this fiscal.
Despite India achieving high growth rate, the development
schemes, the Prime Minister regretted, were not working well
in backward areas, especially those hit by left wing extremism
or naxal violence.
"We must make a concerted effort to bridge the
development deficit in these backward areas and reduce
whatever sense of alienation that may exist among the adivasis
living in these areas", Singh added.
The Prime Minister further stressed that failure to
implement laws like Forest Rights Act and PESA (Panchayat Raj
-Extension to Scheduled Areas Act) "reduces credibility of our
commitment to bring development to these areas."
The Planning Commission, he added, will design a holistic
development plan for naxal-hit areas in consultation with the
states and other stakeholders.
The Prime Minister also made a case for improving terms
and conditions of the Public Private Partnership (PPP)
projects for expediting development of infrastructure sector.
"We ... need to improve terms and conditions on which
PPP projects are awarded to ensure that the process is
transparent, bidding is competitive and public interest is
adequately safeguarded", Singh said.
The Prime Minister also made a case for reducing the
government's subsidy bill and curbing transmission and
distribution losses which were estimated at Rs 40,000 crore
during 2009-10.
Noting the plan outlay was dependent too much on debt,
Singh said, there was a need to reduce public sector losses
and scale down untargetted subsidies.
The Unique Identification Number scheme and information
technology techniques, the Prime Minister said, should be used
to "target subsidies effectively to those who really need
them."
Regarding the power sector, Singh said, the high level
of losses were not sustainable and "unless corrected, it will
make the whole power sector unviable, since investment in
generation and transmission depends upon the ability of the
distributing companies to pay."
Singh asked the Chief Ministers to give personal
attention to the problem of mounting losses in the power
sector, pointing out that "corrective steps needed in this
area lie entirely in the domain of the state governments."
The high losses in the power sector were attributed to
low-levels of tariff charged from certain categories of
consumers like farmers and technical problems relating to
transmission of electricity. PTI