8.5% growth is possible this fiscal: Manmohan Singh

Prime Minister Manmohan Singh has expressed confidence that his government will be able to achieve 8.5% growth during the current fiscal despite concerns over high oil prices.

"As of now, I have not seen any sign that we should change our view with regard to our ability to sustain a growth rate of 8.5%... I am confident that we will be able to sustain a growth rate of 8.5% this year," Singh said last night.

The Reserve Bank in its annual credit policy had pegged the growth for the current fiscal at 8%, down from 8.6% recorded during 2010-11.

Referring to agriculture situation and its impact on inflation, Singh said, "Whatever evidence we have, we expect a normal monsoon. And if the monsoon is normal, it will strengthen our ability to control food inflation".

The headline inflation was 8.66% in April, much higher than the Reserve Bank's comfort level of 5-6%.

On oil prices, Singh said, "There are problems with regards to the burden of oil subsidies. They have to be tackled and all these issues will be claiming our attention in weeks and months to come".

Although the oil marketing companies have raised the petrol rates in view of spiralling prices in the international market, the government is yet to take a view on diesel prices.

A decision on raising diesel price is likely to be taken by the Empowered Group of Minister (EGOM) headed by Finance Minister Pranab Mukherjee in the second week of June.

India imports about 75% of its total crude oil requirement.