Indian govt confident economy will grow over 8.75% this fiscal

New Delhi, Sep 23 (PTI) Upbeat on economic fundamentals,
Indian Finance Minister Pranab Mukherjee Thursday said India
will cross growth projections of 8.75 per cent this fiscal,
but cautioned that infrastructure posed a challenge to bigger
expansion.
"I am optimistic that at the end of this year we will be
able to surpass our GDP growth forecast of 8.5-8.75 per cent,"
Mukherjee said at a meeting of the Indo-German Joint
Commission on Industrial and Economic Cooperation.
However, he added that infrastructure bottlenecks may be
a challenge to 9-10 per cent growth and invited German
companies to take part in the public-private-partnership model
to expand core sector industries.
Mukherjee's optimism on growth was shared by economists.
"We are on advantageous position because of the lower
base of last year. This coupled with good agriculture output
(mainly wheat and pulses) and rural demand would boost
economic growth," said Religare Capital Markets Chief
Economist Jay Shankar.
He said industrial growth is also expected to be higher
in the coming quarters and help India achieve over 8.5 per
cent growth in the current fiscal.
On whether India could achieve over 8.75 per cent growth,
Shankar said, "I am optimistic."
Mukherjee said the economy registered 7.4 per cent growth
in 2009-10, driven by the robust performance of manufacturing
sector on the back of government and consumer spending.
For the first quarter of this fiscal, the economy grew by
8.8 per cent growth.
On the constraints to the big growth, the Finance
Minister said, "Our infrastructure has lagged behind
acceleration in growth, and presents a challenge. We need much
more investment in sectors such as power, railways, ports and
aviation."
Inviting German companies to invest in India, he said,
"We have ambitious programme of investment in these areas to
meet the deficit. The PPP model should offer attractive growth
opportunity for German investors."
Delhi-Mumbai national corridor and Chennai-Bangalore
industrial clusters offer new avenues for foreign investors,
he added.
The Finance Minister said rising demand for energy has
begun to be another important challenge for economic growth.
"Energy availability is critical to attain 9-10 per cent
growth rate as one per cent growth needed 0.8 per cent
increase in energy availability," Mukherjee said.
He said India has a target of 30,000 mw of power from
renewable energy including 20,000 mw from solar power by 2022,
and invited German companies to collaborate in these areas.
Indian Prime Minister Manmohan Singh has asked the plan
panel to upgrade the target of investment in infrastructure to
one trillion dollars in the 12th Five year plan (2012-17),
against 500 billion dollars in the current plan. PTI PPB
SAK


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