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Inflation a concern, but India heading for better times: PM

New Delhi, Jan 3 (PTI): Prime Minister Manmohan Singh on Friday admitted the government's failure to contain inflation but said high prices have helped farmers and the country was heading for better times.”

“…we have also not been as successful in controlling persistent inflation as we would have wished. This is primarily because food inflation has increased. However, we should remember that our inclusive policies have put more money in the hands of the weaker sections”, Singh said while addressing a press conference, his third as Prime Minister.

The worry about inflation, he added, “is legitimate but we should also recognise that incomes for most people have increased faster than inflation.”

While making a case for increasing supplies and improving marketing and logistics to contain food prices, especially of perishables like fruits and vegetables, he stressed “much of this work lies in the domain of the states.”

As regards growth, which has slipped to a decade's low of 5 per cent in 2012-13, the Prime Minister attributed the slowdown to global factors but exuded confidence that the growth momentum would revive in the coming years.

“We are set for better times. The cycle of global economic growth is turning for the better. Many of the steps we have taken to address our domestic constraints are coming into play. India’s own growth momentum will revive”, he added.

He said that during the term of United Progressive Alliance, India for the first time in its recorded history witnessed a sudden acceleration of economic growth to 9 per cent.

“This exceptional performance was followed by a slowdown initiated by the global financial crisis. Over the past couple of years, all emerging economies have experienced a slowdown. India was no exception”, he added.

Singh further added that it was not just the acceleration of growth that “gives me satisfaction. Equally important is the fact that we made the growth process more socially inclusive than it has ever been.”

According to a report card captioned “10 Years of Progress and Growth” released Friday, India's average economic growth rose to 7.7 per cent in the 10-year regime of the UPA government as compared to 6.2 per cent recorded in the previous decade.

“Average GDP growth rate during the period of UPA government (2004-05 to 2013-14) has been 7.7 per cent despite two global slowdown in this period,” the report card said.

Agriculture growth rate, it said, has been rising consistently and the sector expanded by 2.5 per cent and 3.7 per cent during the 10th and 11th Five Year Plans, respectively, and expected to touch 4 per cent in the ongoing 12th Plan period.

It said the country's GDP at current sprice has increased almost three times to Rs 100.28 lakh crore during the last nine years from Rs 32.42 lakh crore in 2004-05.

Similarly, per capita income has risen almost three-fold during the period.

The per capita income has gone up to Rs 68,747 in 2012 from Rs 24,143 in 2004, the report card said.

“Per capita income has increased at an annual average of nearly 20 per cent during the last nine years, well above the consumer price index during the same period,” it said.

On rural wages, the document said it has tripled in the last year and thus improving the purchasing power of majority of people in villages.

Referring to large projects, it said the UPA government has expedited and cleared as many 293 projects involving investment of Rs 5.7 lakh crore in 2013.

To fast-track stalled projects, the government has set up Cabinet Committee on Investment (CCI) and Project Monitoring Group (PMG).

The document said credit flow to Micro, Small and Medium Enterprises (MSMEs) has grown nearly seven times in the last seven years. The outstanding loan to the MSME sector was at Rs 5.27 lakh crore in 2012 as against Rs 83,498 crore in 2005.

In the last two years, the Prime Minister’s Employment Generation Programme has supported 80,000 micro enterprises and so created job opportunities for 9.23 lakh people.

Towards financial inclusion, the document said more people are now using bank facilities. The number of bank accounts has increased from 43.97 crore in 2004 to 77.32 crore as of last year.

The report also said the poverty ratio has fallen steeply during the UPA regime to 21.9 per cent in 2012 from 37.2 per cent in 2004.

“Under the UPA government, poverty in India has declined in an unprecedented manner. Average decline in poverty was 2 per cent per annum during 2004-2012, almost twice the rate of the preceding decade,” said the report card.

It said the number of poor people came down to 26.93 crore, which was 21.9 per cent of the total population in 2012, from 40.71 crore in 2004 when the UPA government came to power.


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