The Hindu 04.11.2009
Priority for urban infrastructure: Montek
Staff Correspondent
| ‘Only 30 per cent of the population lives in urban areas’ |
A MILESTONE: Deputy Chairman of the Planning Commission Montek Singh Ahluwalia inaugurating the Knowledge Centre of T.A. Pai Management Institute in Manipal on Tuesday.
Manipal: Deputy Chairman of the Planning Commission Montek Singh Ahluwalia said on Tuesday that the country should give priority to infrastructure development.
Mr. Ahluwalia was inaugurating the Knowledge Centre at the T.A. Pai Management Institute (TAPMI) here.
He said that huge investment was required in power sector, roads and urban infrastructure. India had the lowest urbanisation. Only 30 per cent of India’s population lived in urban areas. Provision of urban infrastructure posed a challenge. The State governments and the urban local bodies had to raise funds for urban infrastructure.
Less than 20 per cent of GDP came from agriculture, but 50 per cent of the population was dependent on it. But agriculture could grow at only 4 per cent. It was not a good sign that too many people were depending on agriculture.
There was a possibility of 100 per cent increase in agricultural productivity if right inputs were provided. Agricultural transformation would not take place unless it was financed.
Because of the National Rural Employment Guarantee (NREG) Scheme, there had been an increase in the number of bank accounts. Financial inclusion was essential in the country. Indian economy could not grow at 9 per cent, if it was not integrated globally. “We cannot have protective walls,” he said.
The country required foreign investment. The financial sector should learn to cope with the opening up of the economy. At present, the economy had been only partly opened up. There was tension between financial innovation that led to risk and financial innovation which led to efficiency.
The western world had not used financial innovation properly. India was following a balanced approach. “We need to keep our minds and options open,” he said.
India could not be transformed into a rapidly growing economy unless the financial sector took the lead. There was no opposition on the issue of financial regulation.
