India will weather present ‘cloudy’ outlook: Manmohan Singh

October 22nd, 2008 - 3:05 pm ICT by IANS  

Manmohan SinghTokyo, Oct 22 (IANS) Prime Minister Manmohan Singh Wednesday said the short-term outlook for the Indian economy was “cloudy” but the country had some inherent strengths to go back to its high growth path in the medium-to-long run.He also made a forceful pitch for developing countries like India to be a part of the solution to the current global financial tsunami as they did not wish to be mere spectators to the “infirmities” in the regulatory system.

“The short-term outlook is somewhat cloudy but I am confident that the Indian economy has the resilience to sustain its growth momentum in the medium run,” the prime minister told a luncheon meeting with business leaders here.

“We hope to build on India’s many inherent strengths as an emerging market economy that is now ready for rapid and sustained growth,” he told the event, organised by Nippon Keidanren, a leading business association of Japan.

The prime minister, who is well respected in the Land of the Rising Sun as an elder statesman and an economist of repute, said developing countries like India were also affected by the financial crisis and wished to be a part of the solution.

“We cannot afford to risk the gains we have made in the last few years. Nor do we wish to remain vulnerable to the infirmities in international surveillance, supervision and regulatory mechanisms in the future.”

His comments clearly indicated the position he wished to take at the Asia-Europe Meeting in China, where he goes from here Oct 24, with the global meltdown and the financial crisis topping the agenda for global leaders.

The Oxford-educated prime minister also gave a run-down on some of the measures taken over the past month to cushion the impact of the global financial storm, to make forceful pitch for more investments from Japanese companies.

“We have taken several measures in India in the last few days to ensure adequate liquidity and confidence in the economy. The fundamentals of our economy have been, and continue to be, strong,” he said.

“Our banking system is well capitalized,” he said, adding: “We have experienced a shrinking of liquidity but we are responding by injecting additional liquidity to ensure that the rhythm of economic activity is not disrupted.”

He said India continued to build on the many strengths of an emerging market economy and was ready for rapid expansion, having logged an average economic growth of 9 percent over the past few years.

“Once normalcy returns, we can regain the 9 percent growth trajectory. We have a tradition of a high rate of savings, like in most other Asian countries, and a dynamic private sector.”

Singh, who kicked off his three-day official visit after an audience with Emperor Akihito and Empress Michiko also outlined other measures taken by his government to ensure adequate liquidity and confidence in the economy.

He also pointed out that India and Japan could cooperate in many ways.

“Japan is the economic and technological powerhouse of the world. India is a major developing economy. Both of us are located in Asia, to which the 21st century undoubtedly belongs.”

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