Montek for flexibility in Central schemes

Addressing a press conference in Bangalore on the sidelines of a two-day regional consultation with southern states on the approach paper to the 12th plan (2012-17), Ahluwalia all States had expressed the need for more flexibility in centrally-sponsored schemes.

“We have asked the states to specify instances of structural changes they seek. We have an open mind to introduce flexibility”, he said.

In its presentation before the panel on Friday, Karnataka pointed out that assistance to states was provided with too many conditions and sought restructuring of centrally-sponsored schemes to enhance their flexibility, scale and efficiency. Ahluwalia also agreed to another proposal made by the State that power generation companies need to be accorded priority during allotment of coal blocks.

Inflation

Replying to queries, Ahluwalia said inflation will decline to “reasonable levels” by September-October with better macro management and an anticipated good monsoon. He, however, admitted that inflation was higher than the original target of six percent set for March-end. Ahluwalia said the government could not contain the inflationary pressures and missed the target due to rising world food prices and other global factors such as crude oil prices. However, there was no domestic shortage of food in the country, he said.

To a question on the infrastructure debt fund (IDF), he said the volume of investment required for infrastructure projects during the next five years could touch one trillion dollars. “The idea is to find domestic and foreign investors to invest in IDF which can be later channelled for funding long term infrastructure projects”, he said.

Union Minister of State for Planning and Parliamentary Affairs Ashwani Kumar said that his ministry would take into consideration all suggestions that were made by the four southern states. He said that the 12th plan would be finalised by July, and it would go before the Union Cabinet for its approval.

12 th Plan objectives

* Target growth between 9 and 9.5 per cent
* Target growth at least 4 per cent for agriculture
* States must modify APMC rules and modernise land records
* Manufacturing needs to grow at 11 to 12 per cent
* Reforms in FDI and trade policies to attract quality investment
* Universalisation of secondary education by 2017
* Expenditure on health to increase from 1.3 per cent of GDP to 2.5 per cent
* Target of 1,00,000 MW capacity in 12th Plan
* Nuclear power programme must continue with safety review