“The economy has become remarkably resilient to both external and domestic shocks”
Union Finance Minister Pranab Mukherjee has exuded confidence that India will maintain 9 per cent GDP growth rate by the end of current fiscal — 2010-2011.
Delivering the NALCO Foundation Day lecture here on Sunday, Mr. Mukherjee said the GDP growth in the first half of 2010-11 touched 8.9 per cent after an average of 7 per cent in the past two years.
“The economy has become remarkably resilient to both external and domestic shocks. More importantly, the recovery has been broad-based, with agriculture, industry and services all contributing to consolidation of the growth process,” he said.
Mr. Mukherjee, however, expressed concern over the rising fiscal deficit. “We need to work on a roadmap. By 2010-11, fiscal deficit will be around 5.5 per cent. It should be around 4.8 per cent by 2011-12. Every year we are reducing the fiscal deficit by around 0.7 per cent.”
The Minister said: “During the next Five Year Plan, from 2012 to 2017, we envisage financial outlays of over $1 trillion on infrastructure projects. To accelerate the pace of infrastructure development, we have to ensure timely and adequate capacity addition across different sectors of the economy.”
Emphasising on inclusive growth, he said: “To fulfil commitments, spending on the social sector has been rapidly increased and now stands at 37 per cent of the total plan in 2010-11. Another 25 per cent of the plan allocation is devoted to the development of rural infrastructure.”
Mr. Mukherjee, while pointing out that the public sector enterprises were the foundation of the economy, said the government was committed to giving PSEs the flexibility and autonomy for operating effectively in a competitive environment.
Bringing the economy back to the growth path could be possible due to timely intervention of the government, the Minister said.
“When the whole of Europe was in turmoil because of recession, from October 2008 to November 2009, in almost 13 months, our exports had continuously gone downwards because Europe as a whole accounts for 36 per cent of our total export,” he said.
Turning the 50 million-strong young workforce to skilful labour would help India take its rightful place in the international community, Mr. Mukherjee said while spelling out future strategies.