New Delhi, June 6
Facing criticism over the economic downturn, Prime Minister Manmohan Singh today acknowledged that the country was running into more turbulent waters with rising demand and supply bottlenecks leading to inflationary pressure.

Days after members at the extended meeting of the Congress Working Committee (CWC) expressed concern over the impact of rising prices, the PM said, “Domestically, rising demand, along with supply side bottlenecks have contributed to inflationary pressures. All these factors combine to constitute a formidable economic challenge.”

The PM’s observations came at a meeting he undertook to review progress of infrastructure sector. Addressing criticism that the government was in the grip of a “policy paralysis”, he said: “In these difficult times, we must do everything possible to revive business and investor sentiment. We must work to create an atmosphere which is conducive to investment and to removing any bottlenecks that may be hurting growth.”

With the next round of General Elections in 2014 not far away, the road map discussed and deadlines decided at today’s meeting would help the Congress and its UPA allies to face the people more confidently.

The Indian economy, which was growing at almost 9 per cent at one time, has lost its sheen over the last quarter and grew by just 5.3 per cent after being bogged down by scams, high inflation, rising crude oil prices, eurozone crisis and lack of initiatives to boost the domestic market.

It must also be noted that no major decisions concerning the ministries were taken in the Union Budget, following which the government was slammed for policy paralysis.

Emphasising that his government remained committed to take measures to reverse the current situation and revitalise India’s growth story, the Prime Minister said the government was aware that it needed to act on multiple fronts to achieve that.Pointing that the nation would need an investment of $1 trillion over the next five years in infrastructure alone, the PM also emphasised on the need of involving private sectors through public-private partnership (PPP).

He set a target of Rs 8,798 crore set for aviation sector through the PPP mode for 2012-13, an increase from Rs 4,877 crore over the last fiscal’s figure. He also announced that two new airline hubs would be developed to make India a transit point.

Among other targets set in the aviation sector was the commencement of work on the Itanagar airport with a total investment on AAI projects pegged at Rs 2,100 crores. Three new Greenfield Projects will be awarded in FY 13. These will be at Navi Mumbai, Goa and Kannur.

In the power sector, the PM set a target of adding a record 18,000 MW of capacity. He also set a target of Rs 35,000-crore investment in ports for 2012-13, up from Rs 16,585 crore last fiscal.

He said the total road length to be awarded in FY 2012-13 would be 9,500 km, an increase of 18.7 per cent over the last year. The investment would rise by 73.6 per cent.