Addressing the Congress Working Committee (CWC), Gandhi also defended Prime Minister Manmohan Singh from attacks by the opposition and the civil society over corruption charges.
Manmohan Singh also hit out at his critics, accusing them of spreading "canards and falsehoods" against the Congress-led United Progressive Alliance (UPA) government.
Both Gandhi and the prime minister sounded combative at the meeting also attended by senior leaders including Rahul Gandhi, party chief ministers as well as special invitees at the Parliament House Annexe.
Even as she targeted the opposition and vocal critics such as Team Anna, Gandhi focussed on the faction fighting within the Congress that has been blamed for its poor showing in recent state elections.
Speaking in Hindi, Gandhi asked party members to shun factions and start preparing for the Lok Sabha ballot only two years away besides elections in Gujarat and Himachal Pradesh this year.
"If we utilise half the energy we spend on infighting, we would be able to double our strength," she said, in one of her harshest critical remarks on her own colleagues.
"We need to get ready for the Lok Sabha elections in 2014."
She cautioned colleagues that voters will treat them guided by the image they form of the party. "It will be a big mistake to miss this fact."
She defended Manmohan Singh and attacked the opposition and the civil society for hurling "baseless" charges on the Congress and the government.
"The manner in which the opposition and some anti-Congress elements are single mindedly levelling unfounded allegations against the PM and the UPA government is really unfortunate," she said.
At the end of the conference that lasted several hours barring a 30-minute lunch break, the CWC authorized Gandhi to pick the presidential and vice presidential candidates for next month's elections.
According to Congress general secretary Janardan Dwivedi, a resolution to this effect was moved by Finance Minister Pranab Mukherjee, who himself is stated to be in the running for the top post along with Vice President Hamid Ansari.
Gandhi's comments come in the backdrop of escalating allegations of corruption in the allocation of coal blocks during 2006-09 when the prime minister headed the coal ministry.
The Congress and the government have denied any wrongdoing.
In a bid to rebut criticism related to economic slowdown, the prime minister warned that India's economy was passing through "difficult times due to influences beyond (our) control".
"These are difficult times for our country and the economy caused to a large extent by circumstances over which we have little or no control," he said.
"It is very important for all the leaders and workers of the Congress to educate the public about the canards and falsehoods being spread by those who are opposed to us," said Singh.
Mukherjee denied that the Indian economic situation today was comparable to 1991 when a crippling foreign exchange crisis forced New Delhi to embrace sweeping economic reforms.
"There is no reason to believe that we are going back to the situation of 1991," Mukherjee said.
Mukherjee, one of the most senior leaders of the Congress, however admitted that these were "difficult times" for the ruling party.
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