Under attack for rising prices, Prime Minister Manmohan Singh on Tuesday sought political consensus and help from the industry to fight inflation, which he said was largely due to global oil and food prices.
Terming inflation as the immediate challenge, mainly caused by spurt in international oil and food prices, he said: "Global response to the problem has not been adequate" and wanted India too to be part of management of crisis-riddled world food economy and financial system.
He told the annual meeting of the apex industry body CII that domestically prudent fiscal management would be a key concern for the government as "money does not grow on tree," signaling limitation of resources.
Though the government had the primary responsibility, industry, particularly in sectors "characterised by significant market power in the hands of few producers", have a societal obligation to assist in moderating inflation.
As hardening of prices emerged as a major political challenge with Left allies indulging in public criticism, Singh said: "For government to be more productive, more creative and more effective, we would need greater political consensus and some nationally accepted norms of governance in our Parliamentary system."
Last week, the prime minister had asked political parties not to indulge in 'scare-mongering' on prices -- a statement that had offended the Left parties, the main prop for the UPA government.
India has always been a part of solution and never a part of any global problem, Singh said, adding the country's voice must be heard in the management of globalisation.
"I say this because we in India have successfully reintegrated our economy into the world economy in the last 17 years and wish to see globalisation benefit our people," Singh said. Moreover, he said being the world's second largest democracy India is destined to be part of any global problem solving mechanism.
Pointing out that there was a higher level of global integration than even economies like the US and Japan, Singh said India have a stake in the stability and management of global growth process.
"India's share of world trade has gone up and world capital flows has gone up. External trade accounts for more than 40 per cent of our GDP today. This is a higher level of global integration than is the case with economies like the US and Japan," he said.
The prime minister, however, added that while the world wanted India to do well, the challenges were at home. "Sustaining growth momentum in a non-inflationary manner and increasing the competitiveness of our economy is one such challenge," he said.
Merely because the external profile of the country's economy was good did not mean that domestic challenges could be neglected in fiscal management, he added. "Money does not grow on trees. Prudent fiscal management remains a key concern for us in the government," the prime minister said.
