Naxalism bottleneck to GDP growth : Pranab

Kolkata, Jun 18 (UNI) Naxalite activities and other forms of extremism in large parts of the country were posing major hindrance to a sustained high GDP growth and micro-level development across the nation, Defence Minister Pranab Mukherjee today said.

''The problem of Naxalism in 65 districts, militancy in the North-Eastern states and Jammu and Kashmir, besides communal and caste tensions were the bottlenecks to spread our development effort throughout the country,'' he said, while addressing the inaugural session of the annual general meeting of Merchants Chamber of Commerce.

Stressing the need for improving security and maintaining political stability, Mr Mukherjee said it was being physically impossible to reach the affected areas for implementation of development programmes.

''But unless we can do this, it would be difficult to sustain a GDP growth rate between eight and nine per cent,'' he said.

He said stagnant growth in agriculture, fiscal deficit, massive deficiency in infrastructure and energy crisis were the other constraints to the nation's ambition for a higher GDP growth.

Observing that Information Technology, international trade or service sector alone were not able to change the face of rural economy, Mr Mukherjee called for a huge investment in the agricultural sector where the growth rate remained stagnant at two per cent for many years.

The present GDP growth at 7.5 per cent had large contributions from the industrial and service sectors, but it was not possible to sustain the rate without a significant increase in agricultural production, he said and added that at least four per cent rise in agricultural growth would ensure a sustained GDP progress at eight per cent.

Stating that he had suggested creation of model villages with six basic facilities, Mr Mukherjee called upon the corporate sector and NGOs to join hands with the government in developing other villages.

Expressing concern at the combined fiscal deficit which was ten per cent of the total GDP, Mr Mukherjee said immediate corrective measures were needed to change the present scenario.

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