‘Economy to grow at 8-9 percent, inflation to moderate’ (Lead)

August 26th, 2008 - 8:51 pm ICT by IANS  

New Delhi, Aug 26 (IANS) Finance Minister P. Chidambaram Tuesday told heads of industry that the economy would grow eight to nine percent and inflation would start easing from October.“The finance minister was optimistic of an eight to nine percent growth,” Confederation of Indian Industry (CII) president K.V. Kamath told reporters after a meeting with Chidambaram.

Chidambaram, according to Kamath, told a gathering of industry heads that the slowdown in industry was “marginal”, and that it could be attributed to the slump in global economy.

Kamath, chairman and managing director of India’s leading private sector bank ICICI Bank, however, said CII would peg the economic growth slightly lower at 8-8.5 percent in the current fiscal.

This was the first closed-door high level meeting with the industry heads since the Congress-led United Progressive Alliance (UPA) government won the trust vote July 22 in parliament.

Incidentally C. Rangarajan, former Reserve Bank of India (RBI) Governor and immediate past chairman of the Prime Minister’s Economic Advisory Council (EAC), has predicted a 7.7 percent growth in the current fiscal.

CII, a leading industry lobby, had organised a meet between chief executives of top companies and the finance minister to discuss the country’s prevailing economic scenario, and the way forward ahead in view of high inflation and a tightened money supply situation.

Kamath said that the meeting also touched upon issues like falling consumer demand, high interests rates, and how to maintain growth momentum.

India’s headline inflation touched 12.63 percent mark for the week ended Aug 9 as compared to 12.44 percent for the week before.

Chidambaram, according to Kamath, told CEOs that inflation would start to moderate from October-November this year.

Planning Commission deputy chairman Montek Singh Ahluwalia Monday told IANS that inflation would moderate in three to four months time.

EAC’s “Economic Outlook Report for 2008-09” has predicted inflation would come down to eight to nine percent by March 2009.

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