India’s 12th Five Year Plan to Focus on ‘Inclusive Growth’ Posted on Monday, April 25, 2011 by 2point6billion.com
By Teja Yenamandra
Planning Commission’s focus on instilling “inclusive growth” is making headway. The plan is expected to be one that encourages the development of India’s agriculture, education, health and social welfare through government spending. It is also expected to create employment through developing India’s manufacturing sector and move the nation higher up the value chain. Prime Minister Manmohan Singh Apr. 25 – As India’s government prepares to submit its approach paper for its 12th five-year plan (a plan which covers years 2012 to 2017), the, however, warned that maintaining fiscal discipline is important as well. The commission will likely strive to enact policies that will achieve somewhere around a 10 percent growth rate in factories and a 4 percent growth rate in farm produce, though Prime Minister Singh has asked the plan to set the nation’s growth rate firmly at 9 percent to 9.5 percent. Come May, a view into the implementation of these goals should be apparent. A question that India’s government will have to grapple with, much like that of any emerging market, is whether to continue to focus on GDP growth in the face of soaring food prices and economy-wide inflation. An important aspect of generating “inclusive growth” is shifting the target of government aid to rural areas. Typically, large projects such as power generation, roads whereby freight can travel, and airports receive the lion’s share of government subsidies, while rural infrastructure receives comparatively little. A recent op-ed piece in the Wall Street Journal by Saurabh Tripathi, a partner with Boston Consulting Group, echoed these sentiments. “Rural infrastructure, which serves 70 percent of the population, doesn’t get the attention it deserves. As the Planning Commission sets out to draft the country’s planned investments for the next five years, it is...
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