India's domestic demand helped contain global crisis: Pranab

T V SRIRAM
Colombo, Nov 15 (PTI) Finance Minister Pranab Mukherjee
said India's large domestic demand helped insulate the country
against the worst of the global crisis and the effort now is
to bring the economy back to 9 per cent growth.

"The Indian economy has shown remarkable resilience to
the crisis because the financial system had no exposure to the
toxic assets," Mukherjee said, adding policies were also in
place to prevent build up of debt.
Developing countries were in no way responsible for the
crisis but have been the hardest hit, the minister said,
adding India has also been affected "but fortunately not as
bad as some others."
He said India's growth is largely domestic economy
driven, with merchandise exports accounting only about 15 per
cent of GDP.
"The extent of globalisation, however, has increased over
the years, which has been responsible for the setback that the
economy received due to external shocks," Mukherjee said
while speaking at the Kadirgamar Memorial Lecture here.
Speaking on "Economics as a Driving Force of
International Relations," Mukherjee said foreign borrowing in
India was regulated through External Commercial borrowing
guidelines.
This, he said, regulated the end-use and encouraged
borrowings with lower interest and longer maturities.
"This has prevented build up of debt to unsustainable
levels and contained surge and reversal of flows seeking
interest arbitrage," Mukherjee said.
Overall, he said, the economic growth in India was
expected to be in the range of 6-7 per cent in 2009-10,
despite the setback due to poor monsoon.
"The effort now is to bring the (Indian) economy back on
the growth path of 9 per cent per annum," the Indian Finance
Minister said. (MORE) PTI TVS
DDC


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