New Delhi, December 21
Prime Minister Atal Behari Vajpayee today cautioned that achieving 8 per cent growth rate would not be easy if states were not willing to take “difficult decisions” and expressed concern over the slow pace of reforms essentially because of lack of consensus on critical economic issues.

“We must speedily build consensus, no matter how difficult are the decisions involved”, Mr Vajpayee said while inaugurating the 50th National Development Council (NDC) meeting here today.

The Prime Minister urged Chief Ministers to take “difficult decisions” and undertake thoroughgoing reforms and remove bottlenecks in energy, transport and water infrastructure sectors in particular.

“I can see the danger light flashing because of the slow pace of reforms”, he said, adding that the targets could be achieved only if “all of us, regardless of political diversity reflected in the governments at the Centre and states showed unity of purpose and expanded the area of consensus”.

The Prime Minister also announced the proposals to set up three committees of NDCs for removal of inter-state trade barriers, creating an investor-friendly climate and empowering Panchayati Raj Institutions (PRIs).

The NDC meeting adopted the 10th Five Year Plan, which has set a target of achieving a sustained growth of 8 per cent annually during the Plan period, 2002-07, and eradication of poverty and unemployment.

The Prime Minister underlined the need to put in place “a firm roadmap for applying correctives in a time-bound manner” in order to ensure that benefits meant for the poor were not “siphoned off”.

He allayed scepticism that the targeted growth rate should not be seen as unachievable as the current growth rate was 5.5 per cent.

Identifying fiscal deficit as the “biggest worry” the Prime Minister said : “We need to enhance revenues and address the problem of untargeted, runaway subsidies” adding that the Finance Ministry was preparing a paper for reforms on subsidies.

“Let us pledge today to make development a people’s movement and the Tenth Plan a people’s Plan... we have been wedded to achieving India’s all-round development through economic planning with a democratic set up”, the Prime Minister said.

The Prime Minister laid down seven specific areas for consensus building among states. These are: fiscal consolidation, stabilisation function of the Plan, public-private partnership, acceleration and expansion of reforms, connecting major rivers, problems of urbanisation and reforms for the poor.

Striking a note of caution, Mr Vajpayee said it was important to prevent a situation of “worrisome increase in the level of unemployment during the Plan.... we cannot allow such a situation to develop”.

It was important that states consider four specific points in the broader reforms agenda. These are — governance reforms with focus on e-governance, dismantling internal trade barriers, creation of investor friendly climate, and financial and administrative empowerment of Panchayati Raj institutions.

“If we remove the constraints and hurdles in agriculture, industry and services, India’s economy will undoubtedly attain a higher growth rate”, he said.