PM projects 7 pc growth in FY'10; says not good enough

New Delhi, June 9 (PTI) Indian Prime Minister Manmohan
Singh Tuesday said the projected seven per cent growth for the
current fiscal is not good enough and vowed to put the economy
on a 8-9 per cent trajectory despite the global turmoil.

"Given the collective will, if all of us work together,
we can achieve a growth rate of 8 to 9 per cent even if the
world economy does not do well," Singh said winding up the
debate on Motion of Thanks on President Pratibha Patil's
address to the joint sitting of Parliament last week.

Although investments inflows have relatively slowed down,
he said the country's strong 35 per cent savings rate coupled
with foreign investments can be leveraged to achieve faster
economic growth.

"I cannot promise you that we will not be affected by
global events but I am convinced since our savings rate is as
high as 35 per cent... country must have the resilience to so
manage its affairs that it grows at the annual rate of 8-9 per
cent," he said.

Having recorded an average growth rate of 9 per cent for
three years, GDP growth rate slipped to 6.7 per cent in
2008-09, mainly on account of the impact of global meltdown on
the economy.

"...we will maintain, at least 7 per cent growth rate. In
the short run, we cannot do better but that is not good
enough", Singh said.

Prime Minister's optimism about likely economic growth,
however, is at variance with the assertion of President Patil
and forecast of the Reserve Bank of India.

While Patil said, "the current financial year is expected
to see a slowing down of growth on account of the global
recession", the RBI expects the growth rate to moderate to 6
per cent in 2009-10 from 6.7 per cent in the previous fiscal.

Asserting that the mandate in the last general elections
was for inclusive growth, Singh said although the fiscal
deficit in the recent past has shot up, there was enough scope
for increasing public expenditure especially on infrastructure
projects.

The high growth in the first four years of the previous
UPA government, he said, benefited the country in terms of
revenue generation allowing the government to increase fund
allocations for the flagship programmes.

Noting that fiscal deficit has increased in the recent
years, the Prime Minister said, "I do believe that in the
short run... we have manoeuvrability to spend more resources
on our flagship programmes."

Singh said Finance Minister Pranab Mukherjee will unfold
government's strategy to increase investment in flagship
programmes in the budget to be presented in the Lok Sabha
during the first week of July.

"In the present situation, there is considerable scope to
increase public expenditure, particularly on infrastructure
projects and that would not lead to inflation, that would only
add to our development growth potential...that is the right
way to deal with effects of slowdown", the Prime Minister
said.

Singh, however, did not say anything on the government's
approach on disinvestment, which has become a political issue
following objections raised by supporting party DMK.

Noting that fiscal deficit was high, Singh, while winding
the debate in the Rajya Sabha, said "this is one year in which
no country seriously pays attention to fiscal deficit, as we
traditionally understand it."

The whole world is thinking in terms of expending
opportunities for growth and employment generation, he said,
adding "that is what I believe we should do, but we should do
so with caution, with due care, as President's address points
our goal is high growth and low inflation."

Agreeing with Arun Jaitley (BJP) that there were
inadequacies in implementation of the National Highway
Development Programme (NHDP), Singh said, "we will address
them as effectively as we can in months and years that lie
ahead." PTI TEAM
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