Prime Minister Manmohan Singh has expressed concern over the slowing economy but emphasised that the nation must guard against the mood of negativism.

“The current slowdown is a matter of concern… We must guard against the mood of negativism that seems to have gripped the country,” Dr. Singh said while addressing the National Development Council (NDC) meeting being attended by senior ministers and Chief Ministers.

NDC is considering the Approach Paper for the 12th Plan beginning next fiscal.

Referring to the 9 per cent growth target during the next, Plan, Dr. Singh said “it is relevant to ask whether this is feasible since the economy is currently slowing down”.

However, he added, the slowdown should be seen as a short-term phenomenon reflecting highly unsettled conditions in the world economy.

Growth rates, he added, were being revised downwards in all the countries for the current year.

“In setting target for the 12th Plan we must look at longer term potential, assuming that the immediate short-term problems will be overcome. I have absolutely no doubt that our country’s longer term prospects are very good”, he said.

Indian economy, which recorded a growth rate of 8.5 per cent in 2010-11, is expected to moderate to about 8 per cent during the current fiscal.

During the first quarter of the current fiscal the growth slipped to 7.7 per cent from 8.8 per cent a year ago.

Pointing out the world is going through a major realignment of economic power and emerging markets are becoming important, Dr. Singh said “Our policies in the 12th Five Year Plan must therefore be shaped to take full advantage of these emerging possibilities”.

He said that although much of the growth is driven by the private sector, the government has a very large role to play in providing a policy environment to encourage farmers and entrepreneurs.

“This includes an environment of macro-economic stability, efficient functioning markets… a sound financial system for allocating financial resources, good governance with transparency and effective enforcement of the rule of law,” he added.

He further said the government has a very big role to play in developing the infrastructure needed in both rural and urban areas to support broad and inclusive growth.

The Prime Minister said special emphasis would have to be made in the 12th Plan for development of infrastructure in Jammu and Kashmir, North East region and Left wing extremism affected areas.

He said special programmes would have to be devised to provide livelihood support to the poor and vulnerable sections and increase their earning capabilities.

Every citizen, Dr. Singh emphasised should have access to essential public services of “acceptable quality” in areas like, health, education, provision of safe drinking water and sanitation.

“Without such services, effective inclusion is simply not possible,” the Prime Minister said.