Inflation is not a problem in India currently as it was few months ago, said Montek Singh Ahluwalia, Deputy Chairman of India’s Planning Commission on Tuesday (Nov 18) while speaking at the closing plenary of the World Economic Forum’s 24th India Economic Summit, jointly organised by the World Economic Forum and the Confederation of Indian Industry (CII) in New Delhi.
Seeing the current trends, the inflation will certainly go down more with fresh changes in monetary policy, said Ahluwalia, who was quite optimistic over the current growth rate of India as he said, “Though everything is uncertain, yet we should grow somewhere between 7 and 7.5 percent in the current financial year.”
“Even if one takes growth at 7%, which is 2% less than what we have had but still higher than what we had four years ago,” he said
However, he also indicated that the next year's economic performance is linked to the global conditions. “We should basically assume that if the world economy does not do better in 2009-10, then it will be difficult for us to do better than what we do this year,” he said.
“Monetary policy has changed course... We have given ample indication that we are watching the situation and we will not hesitate to do more,” maintained Ahluwalia, who assessed that government's response to the financial crisis was not different from the steps taken by other major countries after mid-September.
He emphasised that government was focusing on the real economy and the improvements in the real economy would impact investors' decision.
For improving the condition, India should step up investment in infrastructure, both in public and public-private partnership. ‘There are existing pipeline of projects that can be accelerated, like the three ultra mega power projects and India would benefit from fiscal stimulus through the speeding up of infrastructure projects in the pipeline,’ he said.
Ahluwalia also assured that Indian Inc would not cut so many jobs in India as it was being seen in world. “It is quite possible that in some of the badly-affected sectors, you may see a contraction,” he said.
Before convening the three-day summit on November 16, India had just attended the G20 summit on November 15-16 organised by US president in Washington on ‘debating global financial crisis’ and as per Indian delegates, India has gained lots of confidence on economic form.
India hopes that the fiscal stimulus by individual countries would be very helpful for the world economy.
The 24th India Economic Summit was commenced under the theme ‘Securing India's Future Growth’ on November 16 in which nearly 700 business, government and civil society leaders from over 35 countries had participated.
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