Ahluwalia moots changes in legal system

According to him, the economic growth rate had risen from around 5 percent in the 1980’s to 6.5 percent during the 90’s, and would accelerate towards 8 per cent in next decade. Against this, the population growth rate would reduce to 1.5 per cent and subsequently, the per capita income would increase by 6 per cent, he said. He cautioned that the government would have to take precautionary measures so as to check unequal distribution of income and wealth.

Structural changes in significant areas such as education and population control which could precipitate the growth process were taking time, he said. Though literacy — regardless of quality — had risen from 18 per cent in the 1960s to about 60 percent today, there had not been any noteworthy check on population growth, he said, and added that only a couple of states in the country’s south had shown remarkable progress.

About the much sought-after changes in legal systems, he espoused that support be extended to regulatory bodies like government financial institutions and telecom authorities. The existing legal system at times acted at cross purposes, which hindered the global competitiveness, thus directly inconveniencing consumers. Several laws of such departments, he said, would have to be rewritten. According to him, though private sector investment in infrastructure was a must, the existing laws at several levels hindered the move.

Ahluwalia bemoaned the fact that hardly any state was initiating measures to promote reforms, despite the well-known fact that it was they who had to do so in their respective areas. He held that fiscal deficits of the states presented a depressing picture. According to him, the major burden these governments had was of salaries, borrowings and losses. Though governments suffered losses because of subsidies, it hurt the more because these subsidies did not deliver the goods.

Later, in a separate session while replying to entrepreneurs’ questions, Dr Ahluwalia said that a great deal of work had yet to be done by the state governments as well as the industries and business houses. He held that unless they did their bit, reforms would not only become redundant but also lead to more problems. He explained to participants’ that the reforms would not affect Indian agriculture.

To another question on the fate of small and medium-scale industries, Dr Ahluwalia admitted that their plight was of a great import, yet none of the lobbies of giants industries was taking up the issues pertaining to the former’s progress. He said he was a votary of duty-free import for the small and medium-scale industries. He offered them a separate meeting exclusively to discuss their problems and methods to address them. He named several industries which had become multi-nationals from small scale.