The Hindu : Front Page : `Government committed to reforms with human face'

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Tuesday, Feb 13, 2007
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`Government committed to reforms with human face'

Special Correspondent

Governor draws a bright picture of the economy in his address to Assembly

CUSTOMARY ADDRESS: Governor Rameshwar Thakur addresses the budget session in Hyderabad on Monday as Speaker K.R. Suresh Reddy looks on. — PHOTO: P.V. SIVAKUMAR

HYDERABAD: Presenting a bright picture of the State's economy in spite of slowdown in power and agriculture sectors over the long term, Governor Rameshwar Thakur has expressed optimism that the same buoyancy will continue in future.

Delivering his customary address to the Assembly on the opening day of the budget session here on Tuesday, Mr. Thakur asserted that his Government was committed to `reforms with a human face for achieving growth with equity'. With top priority being attached to agriculture and irrigation, the State would achieve a 9 per cent annual growth in the overall economy during the 11th plan (2007-12), he said.

In an 80-minute-long speech punctuated by interruptions from the Opposition which later described the address as `directionless', Mr. Thakur observed that power and agriculture sectors had not performed up to expectations. He laid the blame at the doorstep of the previous Telugu Desam Government which, he did not, however, name.

The power situation would have been better if only the erstwhile Government had ensured implementation of the 2500 MW coal-based power projects for which agreements were signed in 1993-94. Unfortunately, even the gas-based short gestation power projects did not begin their operations. "It is now reported that natural gas will be available from 2008 and the power position will improve immediately thereafter," he said.

In the agriculture sector, the growth rate had been falling progressively from 4.49 per cent in the seventh plan, 3.84 per cent in the eighth, 2.07 per cent in the ninth and 2.88 per cent in the tenth (2002-07). It was "our sacred task to rejuvenate the agriculture sector" by reversing the deceleration in the growth rate since the mid 90s. Between 1994 and 2004 (when the TDP was in power), agriculture suffered heavily with a growth rate of just 0.13 and impacted the overall economic growth rate.

On the positive side, the State registered a compounded annual growth rate (CAGR) of 6.79 per cent in its Gross State Domestic Product (GSDP) during the 10th Plan, up from 5.68 per cent in the ninth.

Revenue deficit

A declining revenue deficit which would touch zero by March 2009 and a healthy credit deposit ratio of the banking system were among the other factors that contributed to the economy bouncing back in the Tenth Plan. Another factor was the contribution of more than 50 per cent to the GSDP by the services sector against 16 per cent by the manufacturing sector. Software exports had registered an unprecedented 50 per cent growth in 2005-06 against the national average of 35 per cent.

Declaring that it would be the Government's endeavour to make the State `hut-free' by 2009, the Governor said 21 lakh houses would be built in 2007-08. In the coming fiscal, the budgetary allocation for housing would be the highest ever and next only to irrigation. He summed up the Government's priorities thus: development, welfare and good governance.

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