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Plan panel says 6.5 % growth 'achievable'

Planning Commission said on Saturday that the growth target of 6.5 per cent for the current financial year was 'achievable', but warned that bold political decisions were required in crucial sectors like power and divestment to achieve 8 per cent growth in the Tenth Plan.

"We do not believe that there is any reason to doubt that a growth performance of 6.5 per cent (for 2001-02) can be achieved. In view of the fact that the progress of monsoons and its regional dispersion has been good, there is every prospect of a significantly higher growth in agriculture which should directly boost GDP growth even further," K C Pant, Planning Commission Deputy Chairman, said.

Briefing reporters on the outcome of the two-day full planning commission meeting held under the chairmanship of Prime Minister Atal Bihari Vajpayee, Pant said despite a latest estimate of 5.2 per cent economic growth for 2000-01, the multiplier effect of good agriculture performance could lead to a rebound in the industrial and service sector.

Commenting on the ambitious Rs 160 billion annual target from divestment of PSUs, Pant said, "There are no free lunches. Governments at the Centre and the states will have to take hard decisions in areas like user charges for power and use of power in agriculture, railway fares and downsizing of government."

"We also need to consider the vital aspects of quality of governance particularly at the state level and emphasise on transfer of powers to Panchayati Raj institutions. Then only will they have a sense of ownership and in turn more accountability and transparency," he said.

The approach paper which was approved by the full Planning Commission will now be sent to the Cabinet before being placed for the consideration of the National Development Council, Pant said, adding that no date had been finalised for the meeting of the NDC.

Pant defended the divestment target in the approach paper saying it was not very high keeping in view the Rs 120 billion target set of the current fiscal and added that more focussed unit-wise attention was needed along with more effective policy and programmes to achieve the targets.

Asked if the ongoing Enron imbroglio would have any impact on foreign investments in the power sector, Pant said, "Power sector has much deeper problems including rising T&D losses and financial problems of SEBs."

Problems of theft of power and T&D losses can be addressed by steps like metering but SEBs will have to firmly deal with the issue of levying user charges, he said.

States which have be able to levy and recover the user charges adequately have recovered significantly, Pant said, adding that other states should also follow suit.

Pant said that the full commission meeting had agreed to grant 'special category' status to Uttaranchal as it was found to comply with the conditionalities for granting the status including hilly terrain and backwardness.

He said the commission had however, decided against granting retrospective special status to J&K and Assam as it was felt that the 11th Finance Commission had already granted them benefits and extending such status would lead to duplication of benefits.

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