7% Gdp Growth Target Unrealistic: Chelliah

He said 6 per cent would be an ideal and pragmatic rate of growth for India to keep buoyancy in the economy to encourage fresh investments and spur industrial activity.

Chelliah, while inaugurating the Asian Securities Analysts Federation conference yesterday which was hosted by the Institute of Chartered Financial Analysts of India, said the 7 per cent growth rate envisaged in the ninth plan seems to be an ambitious target.

Chelliah pointed out that the GDP of the country at the current exchange rate would work out to $310 billion. If one follows the purchasing power parity mechanism, a far more truer indicator of the size of economy, the GDP of India could be as high as $1,000 billion, he said.

 

Chelliah said the rate of growth of direct taxes had been satisfactory. He said the personal income tax had been growing by 25 per cent while corporate taxes by 17 per cent. This would work out to 19 per cent and 12 per cent respectively if adjusted against inflation rate.

He said the commitment to bring down the fiscal deficit to 4 per cent by 2001 would provide stability to the economy