Pro-poor policies by the governments must be aimed at growth in the long run and also ensure flow of investments in the sectors working for poor, Prime Minister's Economic Advisory Council Chairman C Rangarajan said in Hyderabad on Friday.
Rangarajan also advocated public-private partnership model for delivery of social services such as health and education.
"The design of policies has therefore, to perform delicate balancing act. The pro-poor policies are necessary as they are to widen the opportunities and capabilities of the poor, must be so fashioned as to promote growth in the long run. Pro-poor policies should include not only income transfers, which by their nature have to be limited, but also flow of investment to sectors and areas where poor work and live. Rural development including agriculture growth thus assumes major importance," Rangaragan said.
He was delivering a foundation day lecture- 'Economic Growth and Development- Synergic and Contradictory' at Centre for Economic and Social Studies.
On the delivery of social services, the economist said the delivery channel need not necessarily be through government administrative mechanism.
"Public-private partnerships in the delivery of these services need to be explored. While taking the advantage of superior administrative efficiency of private institutions, the larger public goals should not be scarified. Public- private partnership mode of delivery can thus supplement the direct delivery of services through government institutions," he added.
In the case of the AIDS programme, which has proved to be a success in India, non-governmental organisations have played an extremely important role, he further said, adding social development and economic growth are not necessarily the same.