While not discounting the challenges of maintaining a high growth rate, Prime Minister Manmohan Singh told top Japanese businessmen here on Monday that his government was confident of India touching 9 per cent or even higher economic growth on the back of reforms aimed at attracting foreign investment.
“It is my expectation that we will return to a 9 per cent growth path in 2011-12. I am confident that the strong fundamentals of the Indian economy will enable us to achieve our objective of double digit growth in the coming years,'' Dr. Singh said at a business luncheon hosted by the Japanese business chamber, Nippon Keidanren. Leading Indian industrialists and members of the India-Japan Business Cooperation Committee, including Mukesh Ambani, Sunil Mittal, Malvinder Singh and Deepak Parikh, were present.
Strong fundamentals
Dr. Singh pointed out that the Indian economy's strong growth fundamentals and its continuous drive to reform the financial sector and competitively priced goods and services at competitive rates were bound to attract investment from overseas. Investment in its infrastructure sector would also be facilitated by Indian expertise in the services sector, knowledge economy and cheaper generic medicines.
“We are continuing the process of reforms of both direct and indirect taxes and hope to unify in due course all indirect taxes into a single Goods and Services Tax (GST). We are pursuing reforms in the financial sector, capital markets, higher education and skill development,” he assured.
India was looking at financial outlays of over $1 trillion in infrastructure projects during 2012 –17 and Dr. Singh said he expected a much larger role by Japanese companies in this development of economic infrastructure. “India's buoyant economy, young population and large market combine well with Japan's technological prowess, manufacturing skills and financial resources. I strongly believe that we must synergise our complementary strengths to impart momentum to Asian as well as global economic growth and prosperity,'' he observed.
Upsurge in trade
On India-Japan economic ties, the Prime Minister drew attention to the upsurge in trade and felt it would cross $20 billion by 2012. “The FDI by Japan in India has grown substantially in the last three years and much of this has been driven by mergers and acquisitions. We welcome greater Japanese investment in creating new capacity in India's manufacturing sector, besides in green field infrastructure projects,” he observed.
The Prime Minister also wanted the Comprehensive Economic Partnership Agreement to be a legally binding document. “We are working on it at the government level and, if need be, at the level of Parliament. This will create new opportunities for India's pharmaceutical industry in the Japanese market, helping Japan to meet its demand for high quality and inexpensive generic medicines,” he said.
