"In the nine years since 2004, we averaged a healthy growth rate of 7.9% per annum. There has been no doubt a slow-down in the recent past, and we will probably end this year at the same level as last year with 5% growth," PM said while addressing Pravasi Bharatiya Divas, organised by the Federation of Indian Chambers of Commerce and Industry (Ficci) here.
He pointed a number of international and domestic factors" have contributed to the slowdown in India's economic growth.
Even for a 5% economic growth in the current financial year, the economy needs to have a higher expansion in the second half than the 4.6% witnessed in the first half. He, however, told that despite these challenges fundamentals of the economy are strong. Our savings and investment rates are still over 30% of our GDP and the entrepreneurial spirit in India is very much alive and kicking.
He stated that the UPA government has taken a very wide range of decisions to accelerate the implementation of mega infrastructure projects, reform tax administration, improve fiscal management, liberalize foreign direct investments and rationalize the system for allocation and utilization of natural resources. With greater political support, we could have legislated deeper reform measures - for example, in the financial and insurance sector. However, our decisions are already beginning to make an impact and India is re-emerging as an attractive investment destination.
Singh said India is changing rapidly from within at the same time as being called upon to adjust to a rapidly changing world. Further, he said the UPA government aims not only to accelerate economic growth but also to make it inclusive. He added that inclusive development is not merely a moral imperative or a political necessity, but an essential ingredient of sustainable long-term economic growth and social stability.
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