Urging the Indian industry to make our growth processes both efficient
and inclusive, the Prime Minister, Dr. Manmohan Singh outlined a Ten Point Social
Charter for this purpose.
Inaugurating the National Conference and Annual Session 2007 of the Confederation
of Indian Industry (CII), here today, Dr. Singh invited corporate India to be
a partner in making ours a more humane and just society.
The Ten Point Social Charter spelt out by the Prime Minister includes healthy
respect for workers and investment in their welfare, corporate social responsibility,
employment to the less privileged, resist excessive remuneration and discourage
conspicuous consumption, and investment in people and in their skills. Elaborating
further, the Prime Minister asked the industry to desist from non-competitive
behaviour, invest in environment-friendly technologies, promote enterprise and
innovation, fight corruption at all levels and promote socially responsible media
and finance socially responsible advertising.
Reminding the captains of industry that we are what we are because of what
our Motherland has given us, Dr. Singh said, “the time has come for us to ask
ourselves what can we give her back. India has made us. We must make Bharat.”
Shri R. Seshasayee, Shri Sunil Bharti Mittal, Shri S.S. Mehta, diplomats, representatives
of business and industry were among those present.
Following is the text of the Prime Minister’s address at the occasion:
“Thank you very much for inviting me to share my thoughts on “Inclusive Growth – Challenges for Corporate India”. Our Government has just completed three years
in office. On this occasion, we released a “Report to The People”, setting out
in great detail the policies and programmes we have been pursuing to make our
economic growth processes socially and regionally more inclusive. In my remarks,
day before yesterday, I clearly stated that the guiding principle of our Government
has been to ensure that, while sustaining higher rates of economic growth, the
improved performance of the economy must contribute to employment generation,
poverty reduction and human development. The aim of each of our flagship programmes
is to ensure that growth is more equitable and that it empowers the most deprived
of our citizens.
I do believe that we have a reasonably good story to tell. I will come
to the growth story later. However, I do recognize that we have a long way to
go in addressing the needs and concerns of all sections of our society, especially
the poorest among us. Our Government came to power to address their felt needs
and aspirations. We remain committed to that goal and that vision.
Employment generation is one important pillar of any strategy of inclusive
growth. I continue to believe that while we continue to focus on agriculture and
accelerate its growth, we must also focus on creating far more jobs in manufacturing.
Given the small size of our farm-holdings and the limits to which technology can
go in making farming on these small holdings viable, it is imperative that we
rapidly expand the creation of jobs in the manufacturing sector which alone can
absorb the large surplus manpower in our rural areas. This is an axiom which all
political leaders and opinion makers must realise if we have to provide a decent
livelihood to all our people.
While our Government will continue to create an environment friendly for
the growth of manufacturing, leaders of industry must also facilitate employment
creation in their industries. This requires expansion of economic activity, investment
in human capabilities and the pursuit of socially, politically, environmentally,
and financially sustainable growth processes. Our Government has its role and
responsibility, and we recognize that so do the better off sections of our society.
This is where I look to the CII for leadership.
While I am on the subject I should like to pay my tribute to the leadership
of the CII. In the last 15 or 16 years, your association, your organization has
played a glorious role in moulding the mindsets of our people to face the challenges
that lie ahead of our country. I congratulate you and I thank you on behalf of
a grateful nation. As I stand before you, I am reminded of the perceptive words
of Lord Keynes on the positive social role of private enterprise in 19th
century Europe. Writing in The Economic
Consequences of Peace, in the year
1925 I believe, Lord Keynes
“…European Society was
so framed as to throw a great part of the increased income into the control of
the class least likely to consume it. The new rich of the 19th century
were not brought up to large expenditures, and preferred the power which investment
gave them to the pleasures of immediate consumption. In fact, it was precisely
the inequality of the distribution
of wealth which made possible those vast accumulations of fixed wealth and of
capital improvements which distinguished that age from all others. If the rich
had spent their new wealth on their own enjoyments, the world would long ago have
found such a régime intolerable. But like bees (these captains of industry) they
saved and accumulated, not less to the advantage of the whole community... (they)
were allowed to call the best part of the cake theirs and were theoretically free
to consume it, on the tacit underlying condition that they consumed very little
of it in practice. The duty of "saving" became nine-tenths of virtue
and the growth of the cake the object of true religion.” That
is how modern capitalism has developed as a powerful entity in transforming social,
economic and political scene all over.
You have all been the beneficiaries of our improved growth performance. When I read about the growing number of Indian
millionaires and billionaires, about Indian companies buying up multinationals
abroad, about our clogged airports, about the real estate boom, about new holiday
destinations, about soaring CEO compensations, I know that you have benefited
from the growth process.
I also know that increasingly you
benchmark yourself against global practices. I appreciate the fact that a corporate
entity’s primary responsibility is to its shareholders and to its employees. Your
businesses have to be globally competitive. However, even to win this race, you
must work in a harmonious environment, an environment in which all citizens feel
equally involved in processes of economic growth; an environment in which each
citizen sees hope for a better future for him and for his or her children.
In a modern, democratic society,
business must realize its wider social responsibility. The time has come for the
better off sections of our society - not just in organized industry but in all
walks of life - to understand the need to make our growth process more inclusive;
to eschew conspicuous consumption; to save more and waste less; to care for those
who are less privileged and less well off; to be role models of probity, moderation
Indian industry must, therefore, rise to the challenge of making our growth
processes both efficient and inclusive. This is our endeavor in Government. It
will have to be yours too and I seek your partnership in making a success of this
giant national enterprise. If those who are better off do not act in a more socially
responsible manner, our growth process may be at risk, our polity may become anarchic
and our society may get further divided. We cannot afford these luxuries.
I invite corporate India to be a
partner in making ours a more humane and just society. We need a new Partnership for Inclusive Growth based
on, as what I would describe as, a Ten-Point Social Charter.
First, have a healthy respect for your
workers and invest in their welfare. In their health and their children’s education,
give them pension and provident fund benefits, and so on. Unless workers feel
they are cared for at work, we can never evolve a national consensus in favour
of much needed more flexible labour laws aimed at ensuring that our firms remain
Two, corporate social responsibility must
not be defined by tax planning strategies alone. Rather, it should be defined
within the framework of a corporate philosophy which factors the needs of the
community and the regions in which a corporate entity functions. This is not an
imported western management notion. It is a part of our cultural heritage. Shri
Seshasayeeji quoted Mahatma Gandhi. Mahatma Gandhi called it trusteeship. It is based on the idea that
the wealthy have an obligation to society and balance in nature. Responsibilities
commensurate with their rights. I am aware that some of our companies are doing
creditable work. I compliment them. But we need more such inspiring examples.
I appeal through the CII to our industry to come forward in a much more substantial
manner and engage extensively in activities which benefit society at large.
Three, industry must be pro-active in
offering employment to the less privileged, at all levels of the job ladder. The
representation companies give to Scheduled Castes, Scheduled Tribes, other Backward
Classes, Minorities and Women, in their workforce and staff must increase.
I am, therefore, encouraged by CII’s Report on Affirmative Action. I commend
your example. I hope it will be widely emulated.
Its recommendations should be implemented by CII members in a time-bound
manner. I look forward to credible results
at an early date. You must show sensitivity to those who are physically less-abled,
in providing a work‑place conducive to their employment. You must employ
retired members of our gallant Armed Forces who spend their youth defending our
nation but retire at a relatively young age.
Four, resist excessive remuneration to
promoters and senior executives and discourage conspicuous consumption. In a country
with extreme poverty, industry needs to be moderate in the emoluments levels it
adopts. Rising income and wealth inequalities, if not matched by a corresponding
rise of incomes across the nation, can lead to social unrest. The electronic media
carries the lifestyles of the rich and famous into every village and every slum.
Media often highlights the vulgar display of their wealth. An area of great concern
is the level of ostentatious expenditure on weddings and other family events.
Such vulgarity insults the poverty of the less privileged, it is socially wasteful
and it plants seeds of resentment in the minds of the have-nots.
Five, invest in
people and in their skills. Offer scholarships to promising young people. Fill
young people with hope in their future. High rates of growth mean nothing for
those who are unable to find employment. We must invest in skill-building and
education to make our youth employable. Here too, I appreciate the CII’s initiative
CII in upgrading ITIs. This is a very good beginning, but there is more to be
done. Indian Industry must allocate sufficient resources to skill development,
either managing ITIs or setting up a network of Greenfield Skill Development Centres
across the country. CII’s current efforts
need to be multiplied a 1000 times and Indian companies need to allocate resources
for this vital work of building the capabilities of India’s youth.
Six, desist from non-competitive behaviour.
The operation of cartels by groups of companies to keep prices high must end.
It is unacceptable to obstruct the forces of competition from having freer
play. It is even more distressing in a country where the poor are severely affected
by rising commodity prices. Cartels are a crime and go against the grain of an
open economy. Even profit maximization should be within the bounds of decency
and greed! If a liberalized economy has to succeed, we must give full play to
competitive forces and the private sector should show some self-restraint in this
Seven, invest in environment-friendly
technologies. India's growth must be enhanced and, yet, our environment and ecology
must be protected and safeguarded for our future generations. Industry has an enormous role to play in this
regard. Evidence shows that many of our companies are becoming increasingly environment
friendly. Our track record in resource use is good, but must improve further.
Conservation of natural resources is a national mission. Industry can and must
provide leadership on this front. As a country of a billion plus people, with
a scarcity of natural resources on a per capita basis, we cannot afford the wasteful
lifestyles of the Western world. Conspicuous consumption must be reduced not just
because it is socially undesirable at our level of development but also because
it is environmentally unsustainable.
Eight, promote enterprise and innovation,
within your firms and outside. If our industry has to make the leap to the next
stage of development, it must be far more innovative and enterprising. The success
story of the last two decades has been the emergence of a large number of first
generation enterprise. As industry aims to master increasingly complex technologies
and becomes organizationally more complex, it must try to maintain its competitive
edge by investing in R&D and innovation and promotion of enterprise. While
government can do its bit, the larger burden is on industry.
Nine, fight corruption at all levels.
The cancer of corruption is eating into the vitals of our body politic. For every
recipient of a bribe there is a benefactor and beneficiary. Corruption need not
be the grease that oils the wheels of progress. There are many successful companies
today that have refused to yield to this temptation. I commend them.
Others must follow. Businessmen who enter politics should erect a Chinese
wall between their political activities and their businesses. CII should develop
Codes of Conduct for their members with respect to business practices and for
control of corruption.
Ten, promote socially responsible media
and finance socially responsible advertising. Through your advertisement budgets
and your investments in media you can encourage socially responsible media to
grow and to flourish. You can promote socially relevant messages and causes.
These are 10 areas in which industry leadership can go a long way to ensure
that our growth process is both inclusive and broad-based. This is not an exhaustive list.
You may wish to add to it, and adopt your own Social Charter for inclusive
growth. The objective of such a Social
Charter would also be to encourage a culture of saving and investment. A culture
of caring, sharing and belonging. We must end forever the debate whether our country’s
march of progress has benefited India and not Bharat. India is Bharat.
The Social Charter I have spoken of is your responsibility to society at
large. We in the government have our obligation to you as well. I firmly believe
that the creation of wealth is the only way of addressing the formidable challenges
of economic transformation that our country faces. And wealth can be created only
through enterprise and creativity. We are committed as a government to work with
industry for the transformation of our economic and social landscape. We do not
believe in an adversarial relationship with industry but in a genuine partnership.
We have worked hard to create a business friendly environment, an environment
which is conducive to rapid growth.
The results are there for all to see. It is not by accident that the average
rate of economic growth has been 9% in the last three years. It is not by chance
that the savings rate of the country is 32% of GDP and the rate of investment
has touched an all-time peak of 35% of our GDP. It is not by luck that the manufacturing
sector is booming. It is not by good fortune that inward FDI is close to twenty
billion dollars now. It is not by a miracle that we are today a trillion dollar
economy. These are the results of balanced, prudent economic policies; policies
which have focused on strengthening every aspect of infrastructure including airports,
roads, railways and ports; policies which have reduced our revenue and fiscal
deficits; policies which have promoted greater investment, both domestic and foreign;
policies which have given a boost to manufacturing and services; policies which
are designed to harvest the demographic dividend we are beginning to get from
a youthful workforce; policies which have pushed development into our rural and
backward areas; policies which have made India a great place to do business.
These are good times for Indian enterprise. Your energy and enterprise
are making its mark globally. The world is beginning to look at us with respect,
because they see Indian professionals and Indian businessmen competing and winning
on the world stage. You have every reason to celebrate this success; to reap its
rewards; to live more comfortably. But never forget that we are what we are because
of what our Motherland has given us. The time has come for us to ask ourselves
what can we give her back. India has made us. We must make Bharat.”
YSR/DS/SKS(Release ID :28178)