The Planning Commission today pitched for continuation of the stimulus provided to the industry till the end of March, notwithstanding the robust 7.9 per cent growth recorded in the second quarter.
Describing the 7.9-per cent growth rate as “very good news”, Planning Commission Deputy Chairman Montek Singh Ahluwalia today said: “I don’t believe that at present there is any particular reason to change the policy (concerning stimulus). The policy has worked and I think where it has worked, we should let it have its full effect.”
Ahluwalia said the right time for reversing the government’s expansionary stance would be at the time of policy planning for the next fiscal year.
“I have said on many occasions that the right time to consider the exit issue will be when we are preparing the policy framework for next year, that is, 2010-11. So, I think we will see in February what things are like,” he said.
Crediting the country’s success story to the reform process, he said it is important to continue the process. .
“The reason why we are a success story is that the reform process is working. I think the thrust on reforms would continue, should continue. It has delivered very good results for us. Continuation of the reform process is very important,” the Plan panel head said.
The Planning Commission is most likely to revise upwards its earlier GDP estimate of 6.5 per cent for this fiscal, he said.
Without giving a new forecast, he, however, said he could not assume that third and fourth quarters would register same growth as in the second quarter.
“The economy is getting back quicker than we estimated,” Ahluwalia said.
On the unfolding Dubai debt crisis, he said it might impact the Indian workforce but would have minimal impact on the financial institutions as their exposure is less. “Our financial institutions have very low exposure in Dubai. So, the effect of Dubai World crisis on us would be very low. But our workforce there may get impacted,” he said.