Corruption, inflation hurt growth: PM

Corruption, inflation hurt growth: PM

Prime Minister Manmohan Singh today asked state governments to launch a crackdown on corruption and inflation, which he identified as two of the biggest challenges the country faces today. Octroi and local taxes could be waived to bring down costs of essential commodities, he suggested.

Speaking at the annual meeting of chief secretaries of states, Singh said inflation posed a “serious threat to the growth momentum”.

“Inflation is something which needs to be tackled with great urgency. The lasting solution for food price inflation lies in increasing agricultural productivity and production not only of cereals but also of pulses, oilseeds, vegetables and fruits and augmenting the supply of milk and milk products, poultry, meat and fish. There is need for a paradigm shift in our institutional arrangements for improving availability of various commodities to meet higher levels of domestic consumption,” he said.

State governments needed to pitch in to tackle inflation, he said. “The functioning of the Agricultural Produce Market Committee Act needs to be reviewed on an urgent basis. There seems to be a strong case for waiving mandi taxes, octroi and local taxes which impede the smooth movement of essential commodities. The public distribution system needs to be strengthened. Storage facilities have to be augmented. Supply chains need to be strengthened.”

The PM also urged the states to take on corruption “frontally, boldly and quickly”.

“Corruption strikes at the roots of good governance. It is an impediment to faster growth. It dilutes, if not negates, our efforts at social inclusion. It dents our international image and it demeans us before our own people,” he said.

The Prime Minister also urged state government officials to devote greater attention to issues of internal security like leftwing extremism and to developing infrastructure facilities at the ground level.