The center should make loans available at lower costs for infrastructure construction and also for increasing (industrial) output as prohibitive (debt) costs have become major obstacles to growth, Andhra Pradesh Chief Minister YS Jagan said on Saturday. Mohan Reddy.
Addressing the meeting of the 6th Steering Council of NITI Aayog through a video conference, Prime Minister Andhra Pradesh said that the Center and the states should make a conscious effort to introduce reforms in the industrial sector to overcome various obstacles and to make the country a center of global production.
“There are five important obstacles to the growth of the manufacturing sector: Excessive cost of funds, high energy costs, delays in land procurement, delays and complexity in issuing legal permits and rigid labor laws,” said the Prime Minister.
A thorough study and analysis of the factors that contributed to some countries making good progress in the manufacturing sector was essential, he said, adding that the Center and the states need to dive deeper to understand the root cause and introduce reforms. to remove obstacles in place.
Mr Jagan said Andhra Pradesh could not yet gain the required momentum of growth in industrialization, despite the commitment of governments to provide a business-friendly environment.
“The bifurcation resulted in my state being deprived of a level 1 city, infrastructure, employment opportunities and financial resources. The rapid industrialization of my state is possible if only Special Category Status is granted,” the prime minister said.
Speaking of infrastructure construction, Mr. Jagan complained that even state-owned enterprises were borrowing money from financial institutions such as the Energy Finance Corporation and the Rural Electrification Corporation with higher interest rates of 10-11 percent per year.
“With this huge demand for debt service, our manufacturing units can not hope to offer products that can compete with the products of countries where credit is available at interest rates of up to 2-3 percent.
This is the case with energy, which is available in some counties at lower tariffs than Rs 3 per unit, “he noted.
For improving physical infrastructure, which he said was a matter of great importance for economic growth and poverty alleviation, Jagan wanted the Center to provide access to low-cost finance for state governments to develop social infrastructure as well. .
“Given the socio-economic conditions, we can not wish far from the fact that the government is and will be primarily responsible for providing critical services in the areas of health and education.
“Low-cost finance will enable states to provide quality services to citizens at affordable rates,” he said.
The Prime Minister wanted the Center to evolve a national policy by making government service in rural areas mandatory for one year for medical and nursing graduates and post-graduates.
Mr Jagan also wanted low-cost loans to set up a market stabilization fund to procure agricultural products in the absence of reward prices for farmers.
This would make it easier for state governments to provide the necessary support to farmers, he added.
He suggested some other policy interventions such as minimizing production costs, providing post-harvest technologies and storage and processing equipment to strengthen the agricultural sector and doubling farmers’ incomes.
Noting that the AP has identified the potential to generate 33,000 MW of energy using reverse pumping technology, the Prime Minister urged the Center to come up with a national policy to encourage the use of this technology that could mitigate the outage associated with renewable energy.
He urged the Center to facilitate state energy services to replace high-cost debt with low-cost long-term loans for the sustainability and survival of the energy sector.
(Except for the title, this story was not edited by NDTV staff and was published by a shared source.)