New Delhi: The strategy of inclusive growth pursued by the Congress-led United Progressive Alliance (UPA) government has helped mitigate the widening social and economic disparities brought about by rapid economic growth, Prime Minister Manmohan Singh said on Friday.

In a speech at the 11th Hindustan Times Leadership Summit in New Delhi, Singh also signalled a possible farewell to a political career spanning two decades with this comment: “We are all birds of passage, actors on different stages... India will continue to rise and, in doing so, will help everyone rise. That is the big picture. For the short period, we mortals occupy the places we do."

India is to go for a national election next year and there is speculation about the whether the embattled Congress-led government, reeling from a series of corruption scandals, will return to power. With the Congress naming Rahul Gandhi, son of Congress party chief Sonia Gandhi, as vice-president of the party in January, speculation is rife that he will be the Congress party’s prime ministerial candidate, though the party has not named him as such.

In his speech, Singh, who has been India’s Prime Minister for nearly a decade, candidly acknowledged the many challenges that confront India, including one of slower economic growth, but saw hope beyond the “problems of here and now".

Recalling the years immediately after India’s independence, Singh said India’s growth rate was 3.5% in 1950 after half a century of zero growth. India then changed tack after it saw other developing countries overtaking it. “In the past two decades, the rate of growth more than doubled to an annual average of 7% and the Indian economy was put on a growth trajectory."

“Naturally, there will be periodic ups and downs," Singh said in an acknowledgement of the present economic slowdown. “The economic cycle presents us years of high performance and years of modest performance. But the highs are getting higher and so are the lows."

India’s economy grew 5% in the year ended 31 March, the slowest pace in a decade, prompting many companies to put investments on hold and consumers to cut spending. High borrowing costs in the face of persistent inflationary pressures and delays in securing mandatory approvals in the face of a policy logjam triggered by corruption scandals have stalled many big-ticket projects.

In his speech, Singh said high economic growth, social change and political empowerment had brought in their wake an apsirational new generation.

“Faced with the challenge of meeting the rising aspirations of our people and of ensuring the political sustainability of high growth, we defined a new strategy of growth that is widely termed as inclusive growth," Singh said, adding that making “growth processes socially and regionally inclusive has been the touchstone of our government’s policies."

Singh was referring to one of the UPA’s main themes since taking office in 2004—to ensure that the dividend of economic growth is shared by all sections of society. He cited programs to boost rural infrastructure, increased investment in education and health care, and the Right to Information Act to make the government responsive and transparent, among others.

“Taken together, these interventions have made our growth processes more socially inclusive," Singh said, adding that the biggest challenge was trying to sustain inclusive growth.

“Any sudden acceleration of growth, as we saw in the period 2004-08, creates imbalances that can contribute to inflation. Such growth can also create opportunities for personal enrichment that distorts governance and creates social resentment. Rising economic growth has helped to liberate millions of Indians from chronic poverty, reducing the incidence of poverty, but it has also widened social and economic inequalities. Our strategy of inclusive growth has sought to blunt the edge of such disparities," he said.

Sunil Kant Munjal, joint managing director, Hero MotoCorp Ltd, described Singh’s speech as “very interesting".

“It was a valedictorian speech as a statesman... As a big-leader speech, it was a good one. He did talk about the long-term future of the economy," Munjal who was present while the Prime Minister spoke, said later by phone.

Singh cited the external challenges faced by India , including the Asian financial crisis of 1997-98, the Trans-Atlantic crisis in 2008-09, the rise of China as a “global mega-trader", and the changing balance of power in global and regional trading regimes.

The ability of India and Indians to deal with the “challenges of globalization and built new bridges with a range of countries has helped India emerge as a global player", Singh said.

“But in the fast few months, Indian business leaders have been worried. I understand their anxieties about our red tape, our tax laws and administration, our regulations and procedures," he said. “I have often found it tough to deal with these challenges because of a lack of political consensus on the reforms we need to bring in."

“Yet I must say, despite all these problems, Indian business and enterprise has demonstrated its ability to cope with competition," Singh said, adding that the widening footprint of Indian professionals and entrepreneurs is influencing foreign policy priorities.

Turning to the scourge of terrorism, Singh noted that terrorist attacks had failed to generate communal conflict. “Terrorism is being defeated in the minds of our people because they are refusing to respond to such attacks in the manner in which the idealogues of terror want them to," Singh said.