India does not expect to overtake China's growth rate anytime in the near future, and even if it did, China's per capital income level will continue to remain much higher than India's, Dr Montek Singh Ahluwalia, co-chair of the Indo-US Energy Dialogue and deputy chairman of the Planning Commission of India, has acknowledged.
At a media breakfast hosted by The Energy Daily and co-sponsored by BP America, Ahluwalia, who kicked off a three-day blitz in Washington, to, among other things, lobby on behalf of the US-India civilian nuclear agreement pending in the US Congress, said, "We are not setting a target in terms of overtaking the growth rate of China."
He said, "China's performance in the last two or three decades has really been quite remarkable and it has had a very good impact on India in terms of benchmarking our own performance."
Ahluwalia noted that the bottom line was that China was growing at over 9 per cent since the three decades and this had led to a very strong perception in India that we ought to look at our own policies and see how we could get rid of the constraints on the assumption that being broadly similar economies, we should be able to achieve these kinds of growth rates.
"So what we are looking at is, what is the scope for acceleration in India," he added.
Ahluwalia explained that the argument about overtaking Chinese growth rates is really based on the assumption that China is likely to slow down, having done a fantastic three-decade run at 9.6 per cent.
"Quite honestly, we are not actually targeting a 9.6 per cent growth. We are targeting an average, which should be above 8 per cent," he said.
He, whoever, did not rule out the possibility as some experts predicted that since China, having reached a certain stage of growth, may begin to slow down a little, and that if it happens, India may be able to register a higher growth rate than Beijing.
But Ahluwalia pointed out, "China's per capita income is much higher than India's. So nowhere, in our targeting are we setting the objective either to overtake China's growth rate or to overtake China's per capita income or any of those kinds of things."
He acknowledged that the Congress approval of the civilian nuclear deal was imperative for India to alleviate its energy needs that are critical for growth rates of 8 per cent plus, saying that all of the other energy sources would not be sufficient.
Ahluwalia argued that if India can get the civil nuclear agreement through by the year 2030, it could increase the nuclear capacity from something under 4,000 megawatts to something of the order of 63,000 megawatts. He said the longer-term nuclear strategy was to rely on thorium as the basis for expanded nuclear program, and that of course required technological constraints to be overcome.
But Ahluwalia said that the problem was really in the transition, between now and when the thorium-based activity could begin, and the principal constraint for India was the availability of domestic uranium.
"So clearly, if we have an agreement with the US and the other Nuclear Supplier's Group partners, we will be able to bring uranium under safeguards, use it to produce electricity and in our view, that is an important part of our energy management strategy," he said.
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