After PM council, Plan Panel warns: Need political will for 9% growth
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Soon after the Prime Minister's Economic Advisory Council said the government has lost policy focus, the Planning Commission has warned that the government cannot adopt a "business as usual" approach and must show "political will" to achieve an "ambitious" 9 per cent growth target set by it for the next five years.
The full Planning Commission chaired by Prime Minister Manmohan Singh is scheduled to meet on Saturday to discuss the approach paper to the XII Five Year Plan.
In its 117-page draft approach paper titled 'Faster, sustainable and more inclusive growth', the Plan panel has projected macroeconomic parameters for two sets of GDP growth projections — 9 per cent and 9.5 per cent. But in laying out the approach for the next five years — 2012-13 to 2016-17 — it seems to have more or less settled for 9 per cent growth rate.
In the Eleventh Plan, the average growth rate is expected to be 8.2 per cent, assuming the economy grows between 8 per cent and 8.3 per cent in 2011-12, the last year of the Plan.
The approach paper is different from those in the past, given its strong focus on implementation, accountability and governance. Not surprisingly, the current political environment has weighed heavily on the Plan panel. It has pitched for a Lokpal to get rid of corruption, which it terms as "morally abhorrent and imposing economic costs". It has also called for a law on public procurement and a legislative framework for governing the function of regulatory institutions for accountability and independence.
"We have identified four sectors — manufacturing, tourism, construction and healthcare services — that have the potential to generate large-scale employment," a Plan panel source told The Indian Express.
For India to grow at an average 9 per cent over the next five years, agriculture must grow at 4 per cent, industry at 9.6 per cent and services at 10 per cent, the Plan panel has projected. For a higher 9.5 per cent growth rate, agriculture needs to grow 4.2 per cent, industry 10.9 per cent and services 10 per cent, it has said.