HYDERABAD: Prime Minister Manmohan Singh on Saturday spoke of his intention of increasing interaction with Chief Ministers on fiscal management and sound economic policies.

He was inaugurating the silver jubilee seminar of the Centre for Economic and Social Studies (CESS) on "Perspectives on equitable development: international experience and what India can learn?" here. He said the State Governments had an important role to play in this effort as well as in bringing down the "unacceptably high" fiscal deficits. "I am beginning this process of interacting with Chief Ministers in Hyderabad today."

"Hard choices"

Asserting that "bankrupt governments cannot promote equity, leave alone growth," Dr. Singh stressed on the fiscal sustainability of growth as a pre-requisite for an equitable growth process and hinted at "hard choices."

"I don't have to tell you that money does not grow on trees. We cannot simply spend our way to prosperity. Development is not a dinner party. Hard choices have to be made," he said and asked economists to guide the Government on how to make those choices.

The Government had two key responsibilities — pursuing macro-economic policies and encouraging new investment on the one hand and providing a social safety net to vulnerable sections on the other.

Higher growth

There was a need for retaining the country's reputation for sound fiscal management. "It is only on the basis of a much higher growth, incomes and revenues high social expenditure can be sustained," Dr. Singh said.

India was on the threshold of unprecedented opportunities. If the right choices were made and the country remained cohesive and faithful to the objectives enshrined in the Constitution, these could be realised. There were no external constraints on India's development. No power can stop India from marking a mark in the world, he said.

The Prime Minister also inaugurated an auditorium and released a book, "India in a globalising world: Issues in Macro Economy, Agriculture and Poverty: Essays in honour of Prof. C. H. Hanumantha Rao."

Chief Minister Y.S. Rajasekhara Reddy, Finance Minister K. Rosaiah, CESS founder B.P.R. Vithal, CESS chairman C. H. Hanumantha Rao and CESS director S. Mahendra Dev also spoke.

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