The Union Finance Minister Shri Pranab Mukherjee said that the greatest challenge before us today is to create and sustain more and better opportunities for a young, growing and aspiring India. He said that an important part of the response to this concern is to ensure that the macroeconomic balance of the economy is strengthened through a determined focus on fiscal consolidation. The Finance Minister said  that it would improve and sustain the growth prospects of the economy.  He said that with Budget proposals for 2011-12, we are moving on that path.

The Union Finance Minister Shri Pranab Mukherjee was addressing the captains of Indian business and industry at CII National Conference and Annual Session 2011.The theme of this year annual conference was “Securing the Future: Framewoprk for Inclusive Growth.”

The Union Finance Minister Shri Pranab Mukherjee said that at the same time,the government and the business enterprises would have to come together in overcoming the several structural concerns that would continue to test us in the coming years.

He specifically mentioned some of these concerns which  include:

·        accelerating capacity in key infrastructure and core industries, which also entails dealing with financing issues in view of large investment needs;

·        focusing on universalisation of elementary education and improvement in its quality to raise transition and retention at middle school and at secondary level;

·        upgrading vocational skills of the workforce, improve job opportunities and productivity, thereby reaping the demographic dividend in full measure; and

addressing environmental concerns and promoting cleaner technologies while sustaining the growth momentum.

The Union Finance Minister Shri Pranab Mukherjee said that the Government is conscious of its role in addressing these concerns but could do better with the support and participation of business enterprises.  He said that It is not only the resources that the Indian businessmen  generate for the public cause and through their philanthropic work under the corporate social responsibility initiatives, but also their managerial skills that are required for making development process more effective.

The Union Finance Minister Shri Pranab Mukherjee drew the immediate attention of the captains of Indian industry and business to the issue that the success of our strategy for inclusive development and, in fact, the  very sustainability of the growth momentum in the coming years depends critically on the availability of skilled manpower. The Finance Minister appreciated the leadership CII is providing to the National Skill Development Corporation and the platform to address its members, there is scope to enhance the role of industry in this area. He told them that large sustainable skill development initiatives could be taken up to contribute to meeting the NSDC target of 150 million skilled persons. The CII could also take the lead in at least 5 to 10 sectors in setting-up sector skill councils including in manufacturing, healthcare and mining, the Minister added.

The Union Finance Minister Shri Pranab Mukherjee said that it is not only sufficient to have good intentions and good policies but it is also important to have them implemented and acted upon which requires collective efforts. The Finance Minister said that together we have the means to address the challenges that we face, or are likely to face in the coming years. He said that we have worked jointly and come thus far, there is no reason that why we should not succeed in our future endeavours.

Later, the Union Finance Minister Shri Mukherjee gave away ” CII President’s Awards 2011″ to the leading entrepreneurs and business leaders. He also launched “Skillpedia” website, a joint initiative of National Skill Development Corporation(NSDC) and CII.

The text of the speech of the Union Finance Minister made on this occasion is given below:

Union Finance Minister’s Address

At

Securing the Future: Framework for Inclusive Growth

CII National Conference and Annual Session 2011

April 8, 2011, Hotel Taj Palace, New Delhi

 

Shri Hari Bhartia President CII,

Shri Muthuraman President Designate CII

Shri Chandrajit Benerjee,

Distinguished Participants,

Ladies and Gentlemen,

It gives me great pleasure to be here today for the inauguration of the Confederation of Indian Industry (CII) National Conference and Annual Session 2011. As India’s prominent business association with a broad based industry membership, CII has been at the forefront in contributing to the creation of a business environment conducive to the growth of Indian industry and economy. I am aware that CII, in partnership with civil society stakeholders in diverse sectors including health, education, livelihood, diversity management, skill development and environment, to name a few, has been proactively engaged in strengthening the development process in the country.

2.      The subject chosen for your annual conference this year namely, “Securing the Future: Framework for Inclusive Growth”, is indicative of that interest and commitment. Incidentally, it is a theme that is close to my heart, as well.

3.      As we look back on the performance of our economy in the first decade of the present Century, despite some setbacks and several challenges, there is a sense of renewed confidence in our abilities. There is a belief of a better future that each one of us nurses. The possibility of realising the promise of our destiny as a developed nation is, perhaps for the first time in our modern history, well within our reach. There are some good reasons that support this thinking.

 

Ladies and Gentlemen,

4.          From 1980, India has experienced a long period of rapid economic growth, with steady economic reforms pushing up the average GDP growth rate in successive decades. Following the reforms in the 1990s, the economy evolved considerably and especially so in the last decade. Since 2003-04, there has been a further step-up in India’s GDP growth with the economy moving to a higher trend growth path of 8.5 to 9 per cent per annum. More importantly, the economy has become remarkably resilient to both external and domestic shocks. It managed to moderate the decline in GDP growth during the global economic downturn and then recovered rapidly in 2010-11. It also took the monsoon failures in the preceding two years in its stride and is now showing robust growth with agriculture production set to record a new high in 2010-11.

5.      In a globalised world with its share of uncertainties and recurrent economic turbulence, the sustained high growth of recent years reflects a maturing of the economic management in the country. It reflects a blooming of the private enterprise, with its growing competitiveness opening new doors to Indian companies in the global market place. As a nation, we have earned our seat on the high-table of international policy and decision making. We have also managed to rework the global nuclear order and the attendant policy regime that had, for long, denied us access to frontier technology in several areas of our national interest.

6.          These developments make us confident about our future prospects. However, there are as many reasons that compel us to brace ourselves to the challenges that remain to be addressed in attaining our goals.

7.      It is evident that the fruits of growing prosperity are not being enjoyed equally by all our citizens. There are gaps in our development efforts and in our governance practices, in the public and the private domains, across sectors and in different regions and population segments of the country. There are also constraints on our capacity to sustain this newfound momentum in the medium to the long-term. Moreover, development has to be holistic and approached in a comprehensive manner so as to include sustained improvement in living-standards, respect and protection of individual freedoms, access to affordable health-care, quality education, social empowerment, social security and environmental balance as the desired goals.

8.          Ideally, the objectives of economic development, the reforms for sustaining high growth and ensuring that growth is also inclusive, should go hand-in-hand. These objectives should be mutually reinforcing and an integral part of the development strategy. In reality that is not always the case, especially in India where structural factors like poverty, illiteracy, deprivation and lack of adequate connectivity have segmented our markets and our people. Some of us have been able to benefit from economic reforms, the liberalization of markets and the prosperity that has been ushered in the country in the past two decades. At the same time, there are many who are struggling to make a simple living, as they can barely participate as productive agents in the markets.

Ladies and Gentlemen,

9.      It is against this reality that we need to assess our approach to inclusive development and layout a framework for securing the future of our people and our nation in the present decade.

10.    The notion of inclusive growth relates to equality of opportunity to all, for a productive and meaningful life, with freedom and dignity.  It is much broader than the objective of poverty alleviation.  It encompasses economic and social mobility for all sections of the society, in particular for the disadvantaged segments of the population.  Such population groups have to be brought into the economic and social mainstream and made active participants and legitimate beneficiaries of the development process.

15.            The multi-prong strategy for inclusive growth adopted for the Eleventh Five Year Plan endorsed a need for:

·      rapid growth for reducing poverty and creating employment opportunities;

·      improving access to essential services in health and education especially for the poor;

·      empowerment through education and skill development; and

·      creating employment opportunities supplemented by the Mahatma Gandhi National Rural Employment Guarantee Scheme.

 

National Rural Health Mission, Rashtriya Swasthya Bima Yojana, Sarva Siksha Abhiyan, and Bharat Nirman are the important programmes that operationalise this strategy.  The Rashtriya Krishi Vikas Yojana was launched with a view to improve agriculture productivity and ensure food security. A strategy for taking the green revolution to the Eastern part of India has been outlined in recent years with focused schemes being launched to address some specific issues in the agrarian and rural economy. There has also been a renewed thrust on the development of physical infrastructure.

16.            That these efforts are showing encouraging results is visible in some of our recent data on these initiatives. For instance, I am told that within a year of launching the initiative on 60,000 pulse villages, assisted by the good monsoons, the agricultural year 2010-11 should see pulses production touch an all time high of 17. 3 million tonnes. This should dramatically cut down our dependence on imports to meet the shortfall in domestic demand. I am quite hopeful that several similar initiatives covering vegetables, protein supplements, nutri-cereals and edible oil that have been launched as a part of the Budget proposals for 2011-12, would yield equally impressive results in the coming years.

Ladies and Gentlemen,

17.            An important element of this strategy is the creation of entitlements backed by legal guarantees on certain aspects of an individual’s life that are vital for her well-being and inclusion in the economic and social mainstream of our society. Thus, in the past five years we have worked towards realising an individual’s right to information and her right to work. This has been followed-up with the enactment of the right to education in 2009-10. As the next step, we are working on the draft Food Security Bill which would represent a significant step in guaranteeing the right to food. To fulfil these commitments the spending on social sector has been rapidly increased and now stands at 37 per cent of total plan in 2010-11.  Similarly 48.5 per cent of the Gross Budgetary Support to plan spending has been allocated to the development of infrastructure. With growth and the opportunities that it generates, we hope to further strengthen the process of inclusive development.

18.                        The success of this strategy rests on sustaining high growth over an extended period of time. I think we have done well on that count, but we need to maintain the momentum in the coming years. Growth of income is important in itself, but it is as important for the resources that it brings in. The past few years have seen significant buoyancy and improvement in the composition of our tax collections, aided by broad based growth and some reforms in tax administration and rationalisation of rates. This process has to be taken to its logical end with the implementation of the Direct Tax Code and the Goods and Service Tax. Meanwhile, the increase in revenues already provide us with the means to bridge the critical gaps that remain in our development efforts, particularly with regard to the welfare of the vulnerable segments of our population.

19.                         It is equally important that the available public resources are effectively used. We are acutely conscious that if these resources have to bear fruit we have to tackle issues of governance and service delivery. Indeed, governance failures and corruption in the system affect the poor disproportionately. An inclusive development agenda cannot succeed without addressing these issues.

20.                        We have taken up an ambitious programme of providing unique identities to the people, focusing initially on the poor and the marginalized, through the Unique Identification Authority of India.  Provision of identity will enhance the access of poor and marginalized to public services, financial services and enable efficient delivery of benefits directly to the targeted population. It is the key that would hopefully facilitate the marginalised to enter and benefit from the economic mainstream.

Ladies and Gentlemen,

21.                         In taking stock of where we are today, I would say that we have reached a decisive phase of our economic development and nation building process.  As a nation we are more confident in dealing with the challenges, domestic and external, posed from time to time. The recent experience of the economic slowdown and the recovery that followed shows that the strategy adopted for pursuing inclusive development has paid dividends, particularly in the rural economy, which is now more robust and resilient to stress.  The challenge to create and sustain more and better opportunities for a young, growing and aspiring India, however, remains.

22.                        An important part of the response to this concern is to ensure that the macroeconomic balance of the economy is strengthened through a determined focus on fiscal consolidation. It would improve and sustain the growth prospects of the economy.  With my Budget proposals for 2011-12, we are moving on that path.

23.                        At the same time, we have to come together, the government and the business enterprise, in overcoming the several structural concerns that would continue to test us in the coming years. Some of these include:

·        accelerating capacity in key infrastructure and core industries, which also entails dealing with financing issues in view of large investment needs;

·        focusing on universalisation of elementary education and improvement in its quality to raise transition and retention at middle school and at secondary level;

·        upgrading vocational skills of the workforce, improve job opportunities and productivity, thereby reaping the demographic dividend in full measure; and

·        addressing environmental concerns and promoting cleaner technologies while sustaining the growth momentum.

24.                        Government is conscious of its role in addressing these concerns but could do more with your support and participation.  It is not only the resources that you generate for the public cause and your philanthropic work under the corporate social responsibility initiatives, but also your managerial skills that are required for making development process more effective.

25.                        There is one such issue that I would like to draw your immediate attention to. The success of our strategy for inclusive development and, in fact, the very sustainability of the growth momentum in the coming years depends critically on the availability of skilled manpower. While I greatly appreciate the leadership CII is providing to the National Skill Development Corporation and the platform to address its members, there is scope to enhance the role of industry in this area. For instance, a few large sustainable skill development initiatives could be taken up to contribute to meeting the NSDC target of 150 million skilled persons. The CII could also take the lead in at least 5 to 10 sectors in setting-up sector skill councils including in manufacturing, healthcare and mining.

26.             Let me conclude by saying that it is not sufficient to have good intentions and good policies. They have to be implemented and acted upon. That requires collective efforts. Together we have the means to address the challenges that we face, or are likely to face in the coming years. We have worked jointly and come thus far, there is no reason that why we should not succeed in our future endeavours.

Thank you

 

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