India’s growth story remains intact: Ahluwalia

November 25th, 2008 - 5:29 pm ICT by IANS  

New Delhi, Nov 25 (IANS) India’s Planning Commission Tuesday said there was no need to alter its growth projection of 9 percent for the Eleventh Plan that runs till 2011-12, despite the economic crisis, as significant additional funding will be made available to pump prime the economy.”I don’t think we require to modify the Eleventh Plan growth,” Planning Commission Deputy Chairman Montek Singh Ahluwalia told the Economic Editor’s Conference here.

“We will provide significant additional funding to clear projects. We are hopeful that the uncertainty in the world economy will recover some time late next year.”

Both Prime Minister Manmohan Singh and Finance Minister P. Chidambaram have said that India will, indeed, experience a lower growth during the current fiscal because of the global meltdown, but still the expansion will be healthy at between 7-8 percent.

“The Reserve Bank has said growth could be 7.5-8 percent. It is more likely to be shaded downwards. We are preparing for as low as 7 percent,” said Oxford-educated Ahluwalia.

The Indian economy grew at an average of over 9 percent in the past four years.

The former finance secretary and International Monetary Fund economist said he was expecting India’s farm sector to grow 4 percent this fiscal and the energy sector to generate 11,000 MW of power.

The government, he said, will go ahead with its plans to spruce up infrastructure and ensure the projects for roads, irrigation and housing sector are not affected.

Nevertheless, since investments were not coming from the private sector, the state sector will chip in to fund these infrastructure development projects, he said.

“This would ensure the capital flow is not disrupted”, says Ahluwalia adding that by January - February next year the government would have a clear picture. “By then we would anticipate what is to be done.”

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