India prepared to face Fed tapering, to grow 5 % in FY14: FM

Claims economy is stabilised and poised to return to high growth path

Assuring global investors that India is prepared to face the impact of US Fed tapering, Finance Minister P Chidambaram today said the country is poised to clock 5 % growth in the current financial year and over 6 % a year after.

 

The Indian economy, he said while addressing the World Economic Forum (WEF) meeting here, has "stabilised and it is poised to return to high growth path and step by step we will go back to 8 % growth rate".

 

In the current financial year, Chidambaram said the country would see a growth of about 5 %, "but next fiscal we will cross 6 %".

 

India's growth rate slipped to a decadal low of 5 % in the financial year 2012-13.

 

Talking about the impact of calibrated tapering of bond purchases by the US Federal Reserve, Chidambaram said: "We have done a lot of preparatory work. There will be some consequences on emerging economies but I think we are better prepared now to face the taper".

 

The Federal Reserve has announced trimming of its $ 85 billion monthly stimulus after US economic indicators improved.

 

"Fiscal consolidation has taken place, there's more FDI flowing into India. We've added to our reserves, the rupee is stable and a number of other measures have been taken to bring stability into the capital market," he said.