Replicating the revolution in the auto industry, government on Friday said it will make India a global manufacturing hub in other sectors like textiles, leather, petroleum, food processing and handicrafts.
"We will become a global manufacturing hub for small cars in the next 3-5 years," Finance Minister P Chidambaram said adding, "we would emulate this success story in other sectors to become top global three manufacturing centres."
Winding up the discussion in the Lok Sabha on the Union Budget, Chidambaram said one talks of industrial and French revolutions but the auto revolution that is unfolding in the country has gone unnoticed for many.
"If every second toy and third shoe in the world are made in China, why can't we emulate these examples," he said asking people to throw away "ideological and political blinkers" while promising all help in this endeavour.
Asserting that growth alone was the best antidote to poverty, Chidambaram said the government has been able to allocate more resources for its flagship programmes and infrastructure due to over Rs 50,000 crore (Rs 500 billion) additional revenue mobilisation annually without coercive tax measures.
Never in the past, the state governments were flush with cash, he said appealing to them to spend various social sector programmes to boost the high growth momentum.
Identifying power sector as a major impediment to industrial development, Chidambaram said contracts will be awarded by this year-end for the five ultra mega power projects for 4000 mw each with total investment of about Rs 90,000 crore (Rs 900 billion) to make up for the "lost ground" in the last few years.
Chidambaram promised there would be no cut in food and fertiliser subsidies, particularly in those which are truly meant for the poor. The PDS system will continue.
Regarding fertiliser subsidy, he said there was a proposal to change the system. But the present system to subsidise fertiliser companies will continue until new system is evolved.
He said there were some arrears claimed by fertiliser companies and due to good revenue position this year the government would clear them by March 31.
Chidambaram said the government proposed to give new impetus to agriculture sector without which the 8-10 per cent growth could not be sustained.
Elaborating on the improved revenue generation, Chidambaram said in the first two years of the United Progressive Alliance government it has recorded over 20 per cent growth. In 2006-07, it is projected to grow over 20 per cent.
The 20 per cent growth has been achieved because of near eight per cent GDP growth, which meant an additional revenue of Rs 50,000 crore (Rs 500 billion) in 2005-06. In the next financial year, the government proposed to mop up additional Rs 54,000 crore (Rs 540 billion) without any new taxes.
This had enabled the government to substantially step up allocation for its eight flagship schemes for rural and infrastructure development, the minister said.
Chidambaram said the states were not far behind in improved financial situation and quoted statistics to say that Rs 73,000 crore (Rs 730 billion) was devolved in 2004-05, Rs 96,000 crore (Rs 960 billion) in 2005-06 and in 2006-07 it was likely to be Rs 1,13,448 crore (Rs 1134.48 billion).
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