Montek visualises bigger role for FDI

New Delhi, Dec 11: Planning Commission Deputy Chairman Montek Singh Ahluwalia today alluded to the broad consensus which has emerged among the State governments for a higher growth of nine per cent per annum in the Eleventh Plan and said they were willing to take steps by way of a suitable policy framework and programmes to achieve this.

Addressing a Press Conference here to highlight the content of the National Development Council(NDC) meeting on Saturday last, Dr Ahluwalia visualised a much bigger role for Foreign Direct Investment(FDI) in the next Plan, but did not think that disinvestment of Public Sector Undertakings was critical to the new strategy.

He said the States were completly supportive of the Commission's thrust for making growth inclusive. This would entail a much bigger thrust to agriculture as 60 per cent of the people still reside in rural areas as well as more allocations for the social sectors, like education and health. The strategy on inclusiveness would also focus on high employment generation and skill development.

Dr Ahluwalia said the State governments were willing to put their money on what they say, having agreed to the broad framework outlined in the document'Approach to the Eleventh Plan.' He said even States like Kerala which have a differing perception about FDI and financial sector reforms were not willing to be left out of the national consenus.

He visualised a much bigger role for FDI, saying that an annual flow in this regard from four billion dollars to seven billion dollars was feasible.

He said the bandwagon in relating to the Eleventh Plan would be led by small and medium enterprises and not the big large companies.

He said Small and Medium companies were a large source of employment generation and regretted that the growth rate of employment in the organsied sector had come down.

Dr Ahluwalia said the final Plan document would set social sector targets for each State--for the first time-- and the States welcomed this move.

The NDC meeting was primarily convened to give its approval to the Approach paper, but later a NDC Sub-Committee Report 'Debt Outstandings of the States against the National Small Savings Fund' was also added to the agenda.

Dr Ahluwalia said the congregation of the Chief Ministers went into the Report and agreed that interest on the high cost debt during the period 1999-2003 on small savings needs to be brought down.

''This would result in a saving of Rs 6,000 crores to the States,'' he said adding that the average interest rate in this period works out to 11.3 per cent.

He said another decision taken by the meeting related to holding another NDC meet to consider the Report of its Sub-Committee on agriculture, headed by Agriculture Minister Sharad Pawar.

The meeting would be held during the Inter Session of the Budget Session of Parliament.

Dr Ahluwalia said there was a lot of discussion at the NDC meeting on agriculture and the manner in which the ''crisis in agriculture'' needs to be combated.

Work on finalisation of the Eleventh Plan had started in the Commission and he expressed the hope that the final document would be ready between March and October, after the next NDC meeting.

UNI