Crisis to continue, but India to achieve 7% growth: Montek

Warning that the global economic crisis would continue through this year, Planning Commission Deputy Chairman Montek Singh Ahluwalia said India would still manage 7 per cent growth in FY09 which should be a "good performance."

Announcing the second stimulus package to reverse the economic slowdown in the country, he said the focus was on public investment, particularly in the infrastructure sector, which according to him should be a big booster.

The package, the second in a month albeit last for the fiscal, would take the total revenue loss to about Rs 40,000 crore for the exchequer by way of various concessions and sops given to various sectors of the economy, Finance Secretary Arun Ramanathan said.

"Expansion of infrastructure investments in PPP area is a very important part of the effort to mark the contra-cyclical thrusts at a point when there is a bit of global slowdown," he said, while commenting on additional facility for IIFCL to issue tax free bonds worth Rs 30,000 crore.

It is something that will not only stimulate demand in the short term, but lay the foundation for broader investment revival and for broader growth.

Ahluwalia said while the current economic crisis has not seen its end, this year could be a difficult one but expressed the hope that the economy would still achieve 7 per cent growth.

"A growth of seven per cent should be a good performance," he said.