Containing inflation, boosting investment top agenda

Written by fe Bureau | New Delhi | Updated: Jun 10 2014, 05:49am hrs
Addressing the joint session of Parliament on behalf of the Narendra Modi government, President Pranab Mukherjee on Monday said it would give top priority to containing food inflation and reigniting the investment cycle.

In his 50-paragraph speech, Mukherjee dwelt upon all aspects of the polity and swore that the government is committed to all-round development of all Indians. He said minorities would be equal partners in progress, vowed to reserve 33% in Parliament and state assemblies for women and coined the slogan of poverty elimination, against poverty alleviation.

The Modi government, he said, would strive for multi-skilling of the youth, create a development paradigm that is youth-led and establish a predictable and transparent policy regime for the benefit of investors.

He also promised transparent policies on allocation of critical natural resources such as coal, other minerals and spectrum.

Reforms would be undertaken in the coal sector to attract private investment in a transparent manner, he said, signalling that the government would either attempt privatisation of commercial coal mining or evolve a more pragmatic public-private partnership model for a sector hamstrung by stagnant output.

A fast-track investor-friendly PPP mechanism has also been promised by Mukherjee for infrastructure development. The government would chalk out an ambitious infrastructure development programme for the next 10 years. He promised a fast, time-bound and well-monitored programme for execution of the National Highways programme, low-cost airports to promote air connectivity to smaller towns, modernisation of existing sea ports and development of new world-class ports, allowing foreign direct investment in sectors that will create jobs and assets, a non-adversarial tax regime and efforts to introduce the goods and services tax (GST).

Stressing that India should be a globally competitive manufacturing hub powered by skill, scale and speed, the president said the government will set up world-class investment and industrial regions, particularly along the dedicated freight corridors and industrial corridors. My government will encourage the domestic industry to innovate and collaborate internationally. It will strive to move towards a single-window system of clearances both at the Centre and at states through a hub-spoke model, he said.

The government, he said, would build 100 new cities focused on specialised domains and equipped with world-class amenities, adding that it would strive to end the rural-urban divide guided by the idea of 'rurban' or providing urban amenities to rural areas while preserving the ethos of the villages.

The president said the railways would be revamped and modernised and announced a Diamond Quadrilateral project of high-speed trains.

In keeping with the BJP's election manifesto, the president said the federal spirit of the country had got diluted and that states and the Centre should function as an organic Team India. In order to actively engage with the states on national issues, my government will reinvigorate fora like the National Development Council and the Inter-State Council. The Centre will be an enabler in the rapid progress of states through cooperative federalism, he said.

On a day the Met department predicted the monsoon would bring below-average rainfall this year with precipitation between 90% and 96% of the long-term average, the president said the government was alert about the possibility of a subnormal monsoon and contingency plans were being prepared.

There would be an emphasis on improving the supply side of various agro and agro-based products. My government will take effective steps to prevent hoarding and black marketing. It will reform the public distribution system, incorporating best practices from the states, he said.

The BJP had flayed he UPA government for the latters inability to curb inflation and had promised urgent steps to address the issue. Retail inflation, the new benchmark for monetary policymaking, continued to be above 8% since February 2012 and rose to a three-month high of 8.59% in April, mainly on elevated food prices.

The last NDA government was successful in controlling WPI inflation in 2003-04 despite a drought as it offloaded huge stocks from official granaries in the open market at cheaper rates apart from importing larger volumes of pulses and edible oils. In contrast, the government in 2009-10 failed to do so, driving up grain inflation by 14.49% in the last drought year.

We must equip and nurture our youth with the right kind of education, skill-set and opportunity to reap this demographic dividend.... (The government) will set up massive open online courses and virtual classrooms, Mukherjee said, while promising new national policies on health, education and energy.

The government, he said, would adopt a National Land Use Policy that will facilitate scientific identification of non-cultivable land and its strategic development.