The Hindu Business Line : Tighten your belts, PM tells corporates

New Delhi, April 29 Apart from asking industry to absorb the increase in input costs to help maintain the price line, the Prime Minister, Dr Manmohan Singh, today also reiterated his message to corporates that “a measure of sobriety in corporate life styles and compensation can also help cut costs and maintain the price level.

“This is what I meant by tightening of belts. It helps your firms, it helps the consumer,” the Prime Minister said while addressing the annual general meeting of the Confederation of Indian Industry (CII) here.

Talking about the inflationary trend in the current economic situation, Dr Singh said the Government had taken several steps which should bear fruit in weeks to come. But, “what is that the industry can do? Let me be upfront and say that industry and trade must eschew the temptation of seeking short-term gains and should cooperate with Government to ensure long-term stability of the growth process.”

“Leaders of industry, particularly in sectors characterised by significant market power in the hands of a few producers, have a societal obligation to assist the Government in moderating inflationary expectations,” he added.

“One important step that the trade and industry can take is to absorb, to the extent possible, the rise in input costs by laying emphasis on improved productivity and thereby help maintain the price line. Industry must also pass on benefits of tax and duty cuts to consumers,” he told the gathering.

Stating that the challenges faced by the Indian economy are internal and not external, the Prime Minister said that sustaining the growth momentum in a non-inflationary manner and increasing competitiveness of the economy was one such challenge.

“Merely because the external profile of our economy is robust does not mean that we can neglect domestic challenges in fiscal management. Money does not grow on trees. Prudent fiscal management remains a key concern of the Government,” the Prime Minister said.

Addressing the meeting the Congress President and the UPA Chairperson, Ms Sonia Gandhi, called for higher corporate participation in the public health sector.

“Rural health mission envisages an important role for public-private partnership. It will always be useful to remind ourselves that the very objective of such public-private partnership is the mobilisation of private managerial, technological, and financial resources for public ends and purposes,” she said.

She also pointed out that the Government’s National Rural Health Mission (NHRM), which has completed two years, was still facing implementation hurdles.

In his address, the Minister for Commerce and Industry, Mr Kamal Nath, said that the ongoing global food crisis was because of the growing use of agricultural land for bio fuels production. He said that his Ministry was forced to ban rice exports to safeguard Indian interests.

India’s engagement with major trade partners for concluding free trade agreements was also helping in making industry in the country competitive, he said.

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