Plan panel may peg GDP at 9% for 2012-17

The Planning Commission is likely to peg the growth target for the 12th Five-Year Plan (2012-17) at 9% despite the ongoing global financial turmoil.

"India has a capacity to grow at 9%... By 2025 India will be the third-largest economy after China and the USA in terms of gross domestic product," Planning Commission Deputy Chairman Montek Singh Ahluwalia said.

The full Planning Commission meet scheduled for tomorrow, will consider the draft Approach paper for the 12th Plan that will seek to raise the annual economic growth rate to 9% from 8.2% estimated in the current Five-Year period (11th Plan). The full Plan panel meet is to be presided over by Prime Minister Manmohan Singh.

The Approach Paper provides a broad framework of the government policy to be pursued in the five-year period to achieve the desired growth rate.

The document will be placed before the Union Cabinet for consideration before being taken up for discussion and final approval by the country's highest policy-making body, the National Development Council (NDC).

The NDC, which is headed by the Prime Minister, comprises Union ministers and state Chief Ministers.

Replying to a question on impact of global financial problems, Ahluwalia said that these may have implication for the short term but "we are planning for the five year period".

Regarding the current fiscal, he said that economic growth could range between 8% and 8.3%.

Elaborating further about the country's growth potential, Ahluwalia said, "In our view, given state of the World and given the many difficulties we will face if we try to accelerate growth, we are in favour of choosing 9% growth rate (for 12th Plan)."