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‘New government will need to revive investments to boost growth’

The new government will need to revive investments and push infrastructure projects within three months of being elected to bring economic growth back on track, Planning Commission Deputy Chairman Montek Singh Ahluwalia has said.

“In my view, if these problems are not solved within the first three months, you can forget about getting back to high (economic) growth,” Ahluwalia said when asked how important reviving investments and pushing growth would be for the new government after the general elections.

Speaking on the sidelines of a CII conference titled “Reviving Investments: Imperatives of Project Clearance’, he said, “Any government that fails to solve this should actually announce that we cancel the growth path.”

An annual average economic growth of 8 per cent is targetted in the 12th Five Year Plan (2012—17), which was approved by the country’s apex decision making body National Development Council (NDC) and all cabinet and chief ministers on its board in December 2012.

However, the economy grew at a decade low rate of 4.5 per cent in the first fiscal of 12th Plan (2012—13).

The Central Statistics Office (CSO) has estimated that economy will grow at a rate of 4.9 per cent this fiscal. Thus, it is unlikely that the target of 8 per cent could be achieved.

About retaining the system of speedy clearance of big infrastructure projects by the Cabinet Committee on Investment by the new government, Ahluwalia said, “…new government must take on the fact that large infrastructure projects in critical areas have got stuck. We have started a mechanism that can work. I would hope that the new government will recognise that this is a very crucial area.”
About Forest Advisory Committee, which is a statutory body of the Ministry of Environment and Forests, and appraises projects, Ahluwalia said stakeholders should be heard while evaluating the merits of a project.

These stakeholders like expert representatives of the concerned ministries should be allowed to submit their dissent note on various issues involved though without any veto power, he added.

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