Commenting on the economy of the state, Mr. Ahluwalia said that he is happy to note that in during the global economic and financial uncertainty, the average annual GSDP growth rate of the state has been 6.65 percent during the first three year of 11th plan against the target of 5.9%. Ahluwalia said he is happy to know that state achieved this despite a drought like situation in the year 2009-10 the state produced 168.35 lakh MT of paddy. However, Ahluwalia expressed concern over State's inability in realizing full development potential.

Complimenting the State Government for initiating reforms including those in the power sector, Mr Ahluwalia said that efforts to encourage private sector in the development of infrastructure both physical and social should continue. Efforts in improving agriculture sector were appreciable, he said. He said State should diversify to other sub-sectors which have enormous potential like fisheries, livestock and horticulture.

Responding to the issues raised by the Planning Commission, Mr Badal said the challenges faced by the State are well known to the policy planners, as the State continues to endure the effects of the long period of militancy. The land locked geographical location coupled with an active border is certain disincentives for which Punjab deserves to be adequately compensated. He requested the Planning Commission to use its good office for allocating increased resources to the State to overcome the special problem.

The State is passing through a phase of fiscal stress on account of huge accumulated debt, implementation of recommendations of Pay Commission and inadequate support from the Government of India. Prolonged period of militancy and tax concessions to neighbouring states during the last 10 years of so have rendered the manufacturing sector in the State uncompetitive. The State has not been able to achieve large scale industrial development.

He said lack of resources have led to excessive dependence on borrowings which have accumulated to Rs.64924 crore at the beginning of the current financial year. The net borrowing of the state in the year 2010-11 would be Rs.6586 crores crore and about Rs.5700 crore of it would go to service the interest liabilities.

The Chief Minister said that top priority in the plan has been accorded to the energy sector for which 36 per cent of the total plan outlay has been earmarked. The Social Service Sector with 26 per cent of the plan outlay is the second priority sector with thrust on pensions to old and other sections of the society, skill development and employment generation, rural water supply schemes, urban development and welfare of weaker sections. Road transport sector with 16 per cent of the plan outlay is also a thrust area with major funding envisaged on account of World Bank and NABARD projects.