8 % growth possible: PM

Says managing coalition is not easy Venkat Parsa

• Asks India Inc to have faith & don't be carried away by a mood of negativism
• Rejects gloomy picture painted by Opposition
• Govt is reviewing FDI in retail

New Delhi: After refusing to rule himself out of the race for the top job in 2014, Prime Minister Manmohan Singh, showing political buoyancy, has rejected the gloomy picture painted by the Opposition. "Have faith and avoid getting swamped by a mood of negativism" was his clear message to the India Inc, as he promised a return to the 8 per cent high-growth trajectory. The Prime Minister went on to unveil a roadmap, saying, "If we can return to the high-growth path that we were on a few years back, it would bring about a transformation in our economy in 10 years, generating new employment opportunities for our young people and reducing age-old poverty to very low levels." Addressing the CII National Conference, the Prime Minister said, "We can, in my view, get back to 8 per cent growth even as we try to make the longer-term changes in our system to deal with these problems. And what is more, we can achieve growth of an inclusive kind." An unusually assertive Prime Minister claimed that during the Eleventh Plan period, India not only grew at an average rate of 8 per cent, but growth was far more inclusive than earlier. Poverty declined much faster. Agricultural growth rate accelerated. Real wages in rural areas grew much faster. Real consumption in rural areas grew much faster. Poorer states grew much faster. This inclusive outcome was the result of a combination of faster growth with a structure that benefited rural areas combined with many government programmes, which encouraged greater inclusion.A Acknowledging economic slowdown, he said business cycles had been a recurrent theme of all textbooks in economics in the past and underlined the need for corrective action. Steps are being taken to contain fiscal deficit. Calibrated steps are being taken towards rationalising fuel subsidies. Petrol is now fully decontrolled and diesel is moving gradually towards market-based pricing over the next few months. The subsidy outflow on LPG has also been capped. The Direct Benefits Transfers arrangement, based on the Aadhaar platform, will ensure better targeting of other subsidies � particularly kerosene � and prevent leakages. "All these steps have sent a message of serious intent on fiscal consolidation, which is well appreciated internationally," he told the India Inc. Listing deficiencies, he said corruption and bureaucratic inertia are a problem and managing coalitions is not easy. "At times, when our democratic processes frustrates us, do remember that it is this very democracy, this commitment to pluralism, commitment to these freedoms that we all cherish, that are the firm foundation of this ancient land's resurgence as a modern nation," he said. "I propose to strike a contrarian note once again. If the business mood was unduly optimistic in 2007, I think it is unduly pessimistic today. This needs correction. Let me explain. In 2007, I often heard it said that government had become irrelevant because India will grow at 9 per cent whatever the government does. The consensus today is that unless the government acts swiftly, our growth, which has already decelerated, will be perennially stuck at 5 per cent. Naturally, I welcome the rediscovery on the part of business of the importance of government!" he declared. In addition to supporting domestic investment, the government has welcomed foreign investment, which has a critical role in bringing in modern technology and globalizing economy. The liberalization of FDI in multi-brand retail, civil aviation and other areas, are important signals. The government is reviewing the FDI policy comprehensively to see what more can be done in the coming months, he added.