Inaugural address of FM at 42nd CCM of Colombo Plan

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INVC,,

The Finance Minister, Shri Pranab Mukherjee inaugurated the 42nd Consultative Committee Meeting (CCM) of Colombo Plan, here today. In his inaugural address, Shri Mukherjee said that as a founder member, India has always been a strong supporter of the Colombo Plan initiative and has always taken a lead in promoting the cause of collective self-reliance among Colombo Plan member countries. He said that India would continue to play the role of an effective partner of the Colombo Plan, established for cooperative economic and social development in the Asia and the Pacific. Talking about the theme of the 42nd CCM, ‘Public Private Partnerships’, the Minister said that for the public private partnership initiative to succeed, it is necessary to remove prevailing constraints in the form of policy and regulatory gaps, inadequate availability of long term finance, management capacity and inadequate shelf of bankable infrastructure projects. ‘We are making our best efforts to create an environment congenial for fostering public private partnerships and though much more needs to be done our endeavours are beginning to bear fruit. There are currently about 450 PPP projects being implemented in various parts of the country with an estimated project cost of US dollar 47.7 billion. India is prepared to share its experience and best practices with, and learn from the experiences of, our other Colombo Plan partners’, stated Shri Mukherjee. On the occasion, the Finance Minister released a compilation prepared by the Colombo Plan Secretariat titled, “A Legacy of Excellence: The Story of the Colombo Plan”.

Following is the text of the Finance Minister’s inaugural address:

“Ambassador of the United States to Sri Lanka and Maldives Ms. Patricia A. Butenis, Secretary-General of Colombo Plan Secretariat Ms Dato’ Patricia Yoon-Moi Chia, Finance Secretary Mr. Ashok Chawla, and other distinguished delegates and guests:

On behalf of the Government and people of India it is my proud privilege to inaugurate the 42nd Consultative Committee Meeting of the Colombo Plan. At the outset, I would like to welcome all the illustrious dignitaries representing member countries, observer countries and International Organizations to India to commemorate the momentous occasion of the Diamond Jubilee year of the Colombo Plan that coincides with the 42nd Consultative Committee Meeting.

As a founder member, India has always been a strong supporter of the Colombo Plan initiative and an active participant. It is pertinent to mention that the second ministerial meeting of the plan was organized by India in 1953. Opening the ministerial, then Prime Minister of India Pt. Jawaharlal Nehru endorsed the need for an imaginative approach towards addressing the problems of the under-developed countries of South and South-East Asia. He suggested that while effective steps should be taken for economic development and for promoting social justice in the region, both donor and recipient countries should adopt a flexible approach, and I [quote] ‘we are approaching this problem practically and not dogmatically always taking into account that we have to go ahead and we have to render social justice’. [unquote] Social justice as a guiding philosophy has been deeply embedded in India’s developmental strategy of inclusive growth that India has pursued ever since it attained independence.

As a founder member, India has always taken a lead in promoting the cause of collective self-reliance among Colombo Plan member countries. Spelling out the strategic vision of the Colombo Plan initiative, the then Prime Minister of India, Smt. Indira Gandhi in her inaugural address to the 22nd CCM in 1972 stated, and I [quote] ‘The Colombo Plan represents a joint attempt of countries with differing systems to help one another in the fight against economic backwardness. That is why we have valued our membership of the Colombo Plan and have actively participated in its work. We have benefited. But it is gratifying that we have also been able to contribute significantly to the programmes of the Plan and to share our experience and skills with other countries of the region’. [unquote]

Keeping in mind this underlying spirit of the Colombo Plan, India has up-scaled its commitment under the ‘Technical Cooperation Scheme’ even in the face of economic problems, such as recent global financial crisis, We have been actively engaged with the initiative from the beginning, and our endeavor would be to continue in the role of an effective partner of the Colombo Plan.

The Consultative Committee Meeting is being hosted in India again after a gap of 38 years. India last hosted the 22nd CCM way back in 1972. Since then India’s economic and social environment has undergone a major transformation that has brought about a major change in our attitudes to growth and development. From a growth rate of around 3% in the first three decades after Independence, India’s growth rate accelerated to 5% in the 80s and 6% in the 90s, and attained a trend rate of nearly 9% in the 5 year period preceding the global financial crisis.

With growing success comes rising expectation, responsibilities and new risks. The growing integration of the Indian economy with the rest of the world has created new opportunities. It has however also brought new challenges and made the task of sustaining high growth more challenging. The recent global financial crisis is a good case in point. Along with all other economies, India too was forced to downgrade its growth projections. Despite the stresses, India has been able to withstand the recessionary trend better than most other economies and is a front runner in leading the global recovery process. The Economic Survey 2008-09 had indicated that the upper bound of growth in real GDP for the year 2009-10 could be around 7.75 per cent. With the latest GDP data on 2009-10 indicating 7.9 per cent growth in the second quarter, the growth outlook for the next two quarters and for the whole year is expected to be in the upper bound range of most predictions for the Indian economy. The Advance Estimates released by CSO on 8/02/2010, for 2009-10, have placed growth in real GDP at 7.2 percent as compared to 6.7 percent in 2008-09.

The performance of the Indian economy in the current global economic scenario indicates its basic resilience based on a virtuous cycle of rising domestic demand and growth. It also vindicates the timely policy measures taken by the Government to mitigate the adverse impact of the financial crisis on India and the positive response of all stakeholders and partners in development. We need to keep this momentum going by infusing and sustaining large investments in infrastructure, both physical and social, in an environmentally sustainable manner. This, in turn, requires continuous flow of capital and institution building. Side by side, to realize the objectives of inclusive growth, we have to continuously work towards strengthening the social welfare net and upgrading the skills of our workforce.

Rising domestic savings and investments and a nationwide emphasis on skill upgradation and skill development gives us the confidence that we can push growth rates even higher so as to fully leverage our demographic dividend. We are, however, also aware that adequate and quality infrastructure has a critical role to play in sustaining high growth rates. It is estimated that investment required in the infrastructure sector would be of the order of US dollar 514 billion during the 5 year period between 2007-12. It is very clear that such huge funds cannot be mobilized without effective public private partnerships. In addition to freeing Government resources to expand investment in core areas where returns are low but are nevertheless necessary from the viewpoint of public policy, PPPs are expected to bring in private sector capital, expertise and efficiency in operation and maintenance of the infrastructure, thereby also improving both the quantity and quality of public service delivery. I am glad that Public Private Partnerships has been chosen as the theme of the 42nd CCM.

For the public private partnership initiative to succeed, it is a necessary to remove prevailing constraints in the form of policy and regulatory gaps, inadequate availability of long term finance, management capacity and inadequate shelf of bankable infrastructure projects. We are making our best efforts to create an environment congenial for fostering public private partnerships and though much more needs to be done our endeavours are beginning to bear fruit. There are currently about 450 PPP projects being implemented in various parts of the country with an estimated project cost of US dollar 47.7 billion. India is prepared to share its experience and best practices with, and learn from the experiences of, our other Colombo Plan partners.

I am pleased to announce that followed by the inaugural address I would be releasing a compilation prepared by the Colombo Plan Secretariat titled, “A Legacy of Excellence: The Story of the Colombo Plan”. I have glanced at the contents of this excellent document and compliment the Secretary General of the Colombo Plan Ms Dato’ Patricia and her team for their unstinted effort in giving shape to this important document that I am sure would be regarded as a key reference document on the Colombo Plan initiative and various activities associated with it. While the document traces the history of the role of the Colombo Plan in the socio-economic development of the region over its six decades of existence, I am sure with every passing year this valuable document would need updating as it would be our collective endeavour to keep the Colombo Plan vibrant and relevant so that it continues to contribute meaningfully to the future development of the region as well.

India views the Colombo Plan as one of the oldest effective regional inter-governmental organizations for cooperative economic and social development in the Asia and the Pacific. The year 2010 heralds the beginning of the Diamond Jubilee year of an idea which has grown from strength to strength over a period of time and developed into a major South – South cooperation initiative. As a founder member of the Colombo Plan initiative, India stands committed to offering its continued support for the initiative. We look forward to constructively working towards making this prestigious and vital organisation vibrant, self reliant and effective in addressing the economic and social challenges faced by the region.

I once again extend a very warm welcome to each one of you and wish the deliberations to follow a great success.” D-279INVC

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