India poised for 8% growth: Montek

By agencies   |   Thursday, 21 April 2005, 07:00 Hrs
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NEW DELHI:India is poised to achieve an annual growth of around eight percent in the near future even as it grapples with the challenges posed by globalization, Deputy Chairman of the Planning Commission Montek Singh Ahluwalia has said.

"India is getting better day by day. There is huge amount of optimism about India. I have no doubt that the country is well positioned to accelerate from its present 6.5 percent growth to around 8 percent in the near future," he said.

"India's growth record during the period of globalization has been much better than it was in the 1960s and 1970s, when economic growth slowed down to 3.5 percent per year. Growth accelerated to around 5.7 percent per year in the 1980s and 1990s and the economy is currently growing at about 6.5 percent," he said.

"The present government has targeted a growth rate of between 7 and 8 percent for the near future. Since population growth has slowed down from 2 percent prior to 1990 to around 1.6 percent at present, the acceleration in the growth of per capita incomes is obviously much better," Ahluwalia said.

The Planning Commission Deputy Chairman said India could emerge within ten years as an economy well on the way to achieving middle income status with a much broader middle class directly linked to the benefit of growth than is the case today. "In Nehru's memorable phrase, we will have brought about India's second tryst with destiny," he said.

He pointed out that international agencies and independent scholars agreed that India could aspire to achieve growth rates of eight percent or so provided supportive steps were taken. "A much quoted recent study by Goldman Sachs identified India, Brazil, Russia and China as the set of large emerging market countries projected to grow rapidly over the next thirty years within the group, India's potential growth rate was projected to be the fastest - around 8 percent per year - faster even than China which is currently, and has been for many years, the fastest growing economy but is expected to slow down in future," he said.

"According to this study, by 2040 India will become the third largest economy after the U.S. and China. This projection has been adopted by the U.S. National Intelligence Council's 2020 report 'Mapping the Global Future'."

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