Worried by the slow progress of economic reforms, Prime Minister Atal Bihari Vajpayee declared on Friday "we need to move rapidly" to end inspector raj through governance reforms at various levels.
"Let me confess that I am myself as dissatisfied as any of you over the slow progress in several areas," he said, adding problems of fiscal consolidation, slow progress of power and labour reforms was worrying.
"The persisting problems in fiscal consolidation at the centre and states worry me. The slow implementation of power sector reforms worries me. The slow progress in labour reforms worries me. The pace of infrastructure investments worries me. We need to move rapidly in these areas," Vajpayee said at the inauguration of FICCI Platinum jubilee celebrations.
Deeply concerned that the systems, procedures, rules and regulations in the government have still not been sufficiently reformed to serve the needs of rapid economic growth, he said: "We may have done away with license-permit-quota raj, but the inspector raj still survives."
"Many entreprenueurs -- especially those in the small and medium scale sectors -- are routinely harassed and humiliated under this inspector raj. This must end," he said apparently outlining the reform agenda in the forthcoming Budget.
Vajpayee said GDP growth could be increased by at least a couple of percentage points without any additional financial investments, but by carrying out necessary governance reforms at various levels.
In this connection, he said the Govindrajan Committee's wide-ranging recommendations for re-engineering the project cycle for public investments, now under implementation, would have a profound effect on execution of fiscal and social infrastructure projects and transform the character of business-government interface.
In addition, he said, the Finance Minister Jaswant Singh has initiated -- in his own silent but determined way -- several other efforts at making the tax system "more business friendly, investor friendly and friendly towards the honest taxpayer".
He sought the support of business community for the success of these initiatives.
Turning to the positive side, he said the economy has weathered all difficulties including drought and global economic slowdown to remain one of the fastest growing in the world.
"In spite of many impediments, our government has not wavered from its commitment to economic reforms, be it on the legislative front or on the implementation front," he said.
"We are trying to carry everyone along through dialogue and consultations, through depoliticising developmental issues and through a constant effort to expand the area of consensus on economic reforms," he said adding in a democracy this process cannot be bypassed.
Stressing that his mission was to make the country's democratic system more and more development-oriented, Vajpayee said this was the basic purpose of economic and governance reforms.
"At the same time, we also have to further democratize our development. The fruits of development must reach the poor and the underprivileged, the gap between the rich and poor must be bridged, the economy must produce more, create more employment opportunities and help people lead better lives," he said.
"This is the basic expectation from economic reforms. The more this expectation is met, the more enthusiastically our people will support the agenda of reforms. And the more vigorously we implement this agenda, the more surely will we be able to meet our peoples' expectations".
"Let this virtuous cycle of reforms-driven development guide the activities of both the government and the Indian business," he added.
Vajpayee appealed to the industry as well as the media not to talk about only negative aspects of the economy as these actions spread cynicism and pessimism, which were malignant viruses that weakened national energy, dissipated the resolve and undermined the sense of purpose.
"Let us not let trivial issues, petty rivalries and old habits of managing the system through unethical practices vitiate the business and political and business environment and damage the interface between business and government".
"In saying that we focus more on positive side of what is happening in the country, I do not in the least wish to suggest that we should overlook shortcomings in the system, criticism should be expressed in a constructive spirit."
Referring to the growing resilience of the democratic system, Vajpayee said this augured well for the long-term outlook for the Indian economy.
"Not only India's democracy, but India's economy too has become more resilient," he said adding, "in spite of adverse developments -- both internal and external -- our economy has demonstrated its inherent strength by emerging as one of the fastest growing economies of the world."
There were some recent adverse developments, but they had helped to recapitulate, he said citing the drought situation, deployment of troops on the borders, global and partial domestic economic slowdown.
Despite all odds, Vajpayee said, "the nation was on the move, the economy was on the move and that we are going in the right direction. I would also like to share the confidence with you that India will move faster, and that the Indian economy will do better, much better, in the time to come."
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