Planning Commission Deputy Chairman Montek Singh Ahluwalia on Wednesday said the 12th Five Year Plan lays emphasis not merely on economic development but on inclusive growth to bring more poor and marginalised citizens under its ambit.
"The one point that I find reading the newspapers talking about the economic development is that there is a tendency to think that economic growth is a very narrow objective," Ahluwalia said while addressing the convocation of the Lucknow University in Lucknow.
"I think that's correct. In the 12th plan for that very reason we have actually set out a very different objective. Our objective is not economic growth, it will happen, but our objective is inclusive growth," he added.
He said that's why constant emphasis was being given to highlight on inclusive growth.
"Name of the game is growth rate that is inclusive, regionally balanced, which makes every state able to do better than in the past, which narrows the gap between different communities, which also brings in our concern for gender equality, upliftment of women, improving their educational condition and social status," he said.
Ahluwalia said "the 12th plan will start a very large agenda of change".
The Deputy chairman said when looking at the newspapers, he would find that the focus was always on the government expenditure.
"That's very important. Actually what is going to cause this growth is not just government expenditure. There is another very important thing we should realise is that 75% of the investment that is actually done in the private sector," he said.
He said, if the economy achieves a 8-9% growth, which it will, then the efforts will depend on individuals like those in the corporate and the agriculture sector.
Ahluwalia said the government has to make sure that the young generation was educated and equipped with both the educational and skill weapons in order to deal with rapidly changing and increasingly globalising world, which was a huge challenge.
The Deputy chairman said in order to achieve inclusive growth during the 12th plan, a very large part requires policies and implementation which was the responsibility of the state governments.
He said states which were earlier thought to be somewhat backward were doing much better.
"It is true that in the first 10 years of economic reforms, the states which were more willing ended up being able to take a great advantage.
"In the 12th plan the most interesting things we find is that the states which were earlier viewed as being backward have now begun to improve their growth quite substantially," Ahluwalia said.
He said UP was aiming at a growth rate of 8.5%, which was possible "if everything which necessarily needs to be done was done".
"The most important thing is that it gives a signal that the states have their destiny in their own hands, they are confident that somethings can be done," he said.
Ahluwalia said that as compared to time when he got his first degree, the country was growing more rapidly in terms of GDP and per capita income.
"We have just finished presentation of 12th plan to the National Development Council which is projecting a growth rate of about eight per cent," he said.
"Right now the growth look low. India is growing as per the latest estimates at five or little bit more than that. This has been a very difficult, bad year for the whole world. Europe is showing zero per cent growth," he added.
Ahluwalia said people were very concerned about slowdown, because lower growth means less jobs.
"In our view for the next five years, I think we can expect an average of about 8% growth," he added.
Meanwhile, interacting with students after delivering a lecture, the Planning Commission's Deputy Chairman in a reply to a question said a target of 50% investment through private sector in infrastructure has been made in the 12th Plan.
"In the 11th Plan, we basically said...we need a lot of investment... the state doesn't have all the resources needed so let's bring in the private sector," he said.
"In fact we have been quite successful because in 10th Plan only 10% of the infrastructure investment came through private sector, in the 11th Plan it was 37%, a lot of that was in telecom sector.
In the 12th Plan what we are saying is that we need more investment and the private sector share has to be 50%," he added.
Ahluwalia, however, said it was not a prediction.
"We are not actually making a prediction that it will happen...we ourselves recognise that's a challenge. To be honest right now we are going through a downturn. Investors are in a very shell-shocked position, hopefully in another few months their attitude...may change," he said.
He said they knew what the constraints were and what was holding up private investment project.
"There is lot of money in the world willing to finance workable, financeable, infrastructure investment in India if we can take care of these problems. That is why the central government has set up Cabinet Committee on Investment," he said.
He said the committee has set up to try and accelerate clearances.
