| Prime Minister Manmohan Singh with commerce minister Kamal Nath, Klaus Schwab, executive chief of the World Economic Forum, and CII president Y. C. Deveshwar (extreme right) in New Delhi on Tuesday. Picture by Rajesh Kumar
New Delhi, Nov. 29: Prime Minister Manmohan Singh today set a 10 per cent growth target over the next two to three years, while projecting a rate of 7.5 per cent for this year.
“It is feasible to achieve a 10 per cent growth, if we make a quantum leap in agriculture, industry and services,” Singh said at the India Economic Summit.
“We should be targeting a 10 per cent growth rate in two to three years,” he added.
He is keen on setting right progress-related problems arising from bureaucratic hurdles.
Singh also hinted at the government’s willingness to throw open the retail sector to foreign investors, saying it is engaged in an “intellectually stimulating exercise to understand the possibilities that exist in opening up this sector and how best we can harness it for our needs.”
Left party leaders are engaged in talks with the government on the possibility of opening up the sector. Bengal chief minister Buddhadeb Bhattacharjee has expressed his keenness to get foreign investment in backroom operations vital to the retail industry such as cold storage chains.
The Prime Minister said those who oppose economic reforms “continue to be prisoners of the past” as mindsets, attitudes and aspirations have changed during the past two decades.
Analysts view this as his frustration with alliance partners, especially the Left parties, who have tried to stiflemost reform measures.
The government was trying to build a consensus on adding flexibility to the labour market, while having “credible social safety nets”, Singh said. Employment opportunities in infrastructure, manufacturing and trade can be created only if investors find it attractive to invest in “labour-absorbing technologies and labour-intensive sectors”, he added.
Singh also foresaw the creation of a pan-Asian free trade area covering major economies, including China, Japan and South Korea, and possibly extending to Australia and New Zealand. “This pan-Asian FTA could be the third pole of the world economy after the EU and NAFTA and will, I am certain, open up new growth avenues for our own economy,” he said.
Singh said growth was “eminently feasible” if there was an increase in savings, driven by the country’s workforce. However, agriculture will remain at the epicentre of the growth process.
The government has been trying to push through a crucial pension reforms bill, which will enable private investment in the sector. This route can be tapped to increase the rate of savings in the country.
It has also been working on a two-pronged strategy to revitalise farming by pumping fresh credit into the sector and stepping up public investment in irrigation, rural roads and markets.