India to clock 8-9.5% growth in long term: Pranab

The government may not be too sure about its previous estimates of nine per cent economic growth for this fiscal, but it is pretty confident that India will clock 8.5 to nine per cent growth in the medium to long term.

“In the medium to long term, we remain firmly on a high GDP growth path of 8.5 to nine per cent,” finance minister Pranab Mukherjee said at a function to mark 25 years of India-ADB (Asian Development Bank) Partnership. In fact, the Planning Commission,n in its approach paper to the 12th plan (2012-17), has set a target of nine per cent GDP growth for the next five fiscal years.

 

Prime Minister Manmohan Singh, who heads the commission, had, however, also kept an option open to raise the target of growth rate to 9.2 per cent, if global economic environment improved and domestic inflation went down by the start of the next fiscal, when the plan period starts.

On Monday, the finance minister cautioned that the country needed to remain alert to the emerging challenges and promptly respond to them. Quality infrastructure was critical for enhancing productivity and for sustaining the growth momentum, he added. The 12th FYP, he said, has an ambitious target of infrastructure investment estimated at one trillion dollars or nearly 10 per cent of India’s GDP.

Pointing out that ADB’s investment support in this sector, including in public private partnership projects, has been noteworthy, Mukherjee said India and the Manila-based institution need to further step up the momentum of collaboration in this area in view of the huge investment needs of the sector.

The minister called upon ADB to include all countries of Asia in its studies instead of confining to its members. “While there are some well functioning regional groupings in Asia, there is an urgent need for further progress towards the building of a Pan-Asian community.”

ADB should take up South-South cooperation as a priority and become a vehicle for countries to share their experiences in inclusive growth and poverty alleviation, he added.