Nine per cent growth will require "longer time": Pranab
New Delhi: Faced with the impact of the global downturn as well as drought, the government said on Tuesday it would take "longer time" for the country to achieve the 9 per cent growth as witnessed before the financial crisis hit the world in September, 2008.
"To achieve 9 per cent growth (it) will require little
longer time", Finance Minister Pranab Mukherjee said,
participating in a function organised by a private TV channel.
Mukherjee said this fiscal "we will have six per cent
plus growth." "Whether that will be 6.5 or 6.2 per cent I
cannot say. To achieve 7 to 8 per cent, (it) will be possible
in the short term."
Promising to continue reforms in various sectors of
the economy, the minister said, "the process (which) began in
the early 90s will continue in the right earnest so that the
economy is back on the path of 9 per cent growth at the
Having grown by nine per cent during the three years
ending March 2008, India`s economic growth rate slipped to 6.7
per cent during 2008-09, mainly on account of the impact of
the global financial crisis.
With 246 districts out of a total of about 600 facing
drought, the growth rate is estimated to decelerate further to
little over 6 per cent. The Reserve Bank of India in its first
quarterly review of the credit policy projected 6 per cent
growth rate for the current fiscal with upward bias.
The top priority of the government, Mukherjee said,
would be to mitigate the impact of the deficient rainfall on
the agriculture sector as well as the economy as a whole.
"At this juncture, delayed monsoon has impacted many
parts of the agrarian economy ... Mitigating the impact of
deficient monsoon is a high priority," he said.
"Despite the global economic crisis, we grew by 6.7 per
cent last year... This year, we are getting mixed signals,"
he said, noting that indicators are coming good from
industrial production data and in terms of business
demand and investor confidence.
The Minister, however, added that the government was not
in a position to lower its guard, given the continuing
uncertainties in the global economic scenario.
Referring to large government borrowing programme
during the current fiscal, Mukherjee said it will not have any
impact on the interest rates as is being feared by the
industry as well as bankers.
The government proposed to borrow Rs 4.5 lakh crore
from the market during the year as compared to Rs 3.1 in the
The government, the Minister said, was also working on
a proposal to set up a Debt Management Office (DMO) to manage
On disinvestment, Mukherjee said, the intention of the
government was not only raise money by offloading shares of
the state-owned enterprises but also to make them more
In his budget speech, the Minister had said, "the PSUs
are wealth of the nation, and part of this wealth should rest
in the hands of the people. While retaining at least 51 per
cent government equity in our enterprises, I propose to
encourage people`s participation in our disinvestment
Talking about taxation reforms, Mukherjee said the
Direct Taxes Code will improve the efficiency of the taxation
structure in case of direct taxes. Similarly, he added, Goods
and Services Tax (GST) would reform the indirect tax
The government proposes to replace the Income Tax Act,
1961 with a new Code, which was recently released for public
debate. The GST is proposed to be implemented from April 1,
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