Indian economic growth may outstrip China's in 4-5 years
The Hindu Business Line, January 05, 2010, Page 15
Our Bureau, New Delhi
India's economic growth could touch 10 per cent in the next couple of years and may even beat that of China in the next four years, Dr Kaushik Basu, Chief Economic Advisor in the Finance Ministry, has said.
The country is likely to return to the 9 per cent growth trajectory by the end of next fiscal, Dr Basu said, at a meeting organised by the Federation of Indian Chambers of Commerce and Industry (FICCI) here on Monday.
On monetary tightening to tame inflation, Dr Basu later told reporters that there is “no expectation of monetary tightening, nor do I believe there is a reason for this”.
Dr Basu highlighted that India was only seeing a sector-specific inflation.
“You don't want to have an effect across the board which increases unemployment. Right now, we need sector-specific intervention which is in the food sector and that is what the Government is doing. My expectation is, it is going to have an effect. Inflation will peter out in the next few months,” he said.
On how Indian economic growth rate compared with that of China, Dr Basu said the fundamentals of the Indian economy were very strong.
“If India can get back to the 9 per cent growth path and take a couple of complementary policies….. because there is so much slack in the economy. If India follows those, it should not surprise anyone if growth rate crosses the Chinese one in about four-five years”.
On when the fiscal stimulus would be rolled back, Dr Basu said that at some time the fiscal stimulus has to be rolled back but declined to conjecture on when that point would come.
Dr Basu also said that he expected the savings rate to exceed 40 per cent in the coming years and this could give a boost to the economic growth.
The senior Finance Ministry official also said that India's economic growth would be more than 7.5 per cent this fiscal.
The Hindu Business Line, January 05, 2010, Page 15
Our Bureau, New Delhi
India's economic growth could touch 10 per cent in the next couple of years and may even beat that of China in the next four years, Dr Kaushik Basu, Chief Economic Advisor in the Finance Ministry, has said.
The country is likely to return to the 9 per cent growth trajectory by the end of next fiscal, Dr Basu said, at a meeting organised by the Federation of Indian Chambers of Commerce and Industry (FICCI) here on Monday.
On monetary tightening to tame inflation, Dr Basu later told reporters that there is “no expectation of monetary tightening, nor do I believe there is a reason for this”.
Dr Basu highlighted that India was only seeing a sector-specific inflation.
“You don't want to have an effect across the board which increases unemployment. Right now, we need sector-specific intervention which is in the food sector and that is what the Government is doing. My expectation is, it is going to have an effect. Inflation will peter out in the next few months,” he said.
On how Indian economic growth rate compared with that of China, Dr Basu said the fundamentals of the Indian economy were very strong.
“If India can get back to the 9 per cent growth path and take a couple of complementary policies….. because there is so much slack in the economy. If India follows those, it should not surprise anyone if growth rate crosses the Chinese one in about four-five years”.
On when the fiscal stimulus would be rolled back, Dr Basu said that at some time the fiscal stimulus has to be rolled back but declined to conjecture on when that point would come.
Dr Basu also said that he expected the savings rate to exceed 40 per cent in the coming years and this could give a boost to the economic growth.
The senior Finance Ministry official also said that India's economic growth would be more than 7.5 per cent this fiscal.
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