PM sees 8.5 percent growth, inflation cooling by Dec

PM Manmohan Singh today said the country’s economy is fast returning to high growth trajectory and the government is hopeful of containing inflation.

Zeebiz Bureau

New Delhi: The country’s economy is fast returning to high growth trajectory and the government is hopeful of containing inflation to 5-6 percent by December, Prime Minister Manmohan Singh said Monday while speaking to reporters here to mark the first anniversary of the UPA-II.

“It’s not correct to say that our economy in not robust. Many economies collapsed worldwide due to the financial crisis. But India grew by 6.7 percent in 2008-09 and 7.2 percent in 2009-20,” said the Prime Minister.

He added that the country would witness 8.5 percent growth in the current fiscal.

The Prime Minister further admitted that inflation was problem and the common man suffered due to high prices.

"Prices continue to be a matter of concern ... it is affecting the country`s masses ... but I believe by December we can bring it down to 5 to 6 percent,"

Singh said the government has been monitoring inflation and has been taking measures to check the rising prices, particularly food products hit by poor monsoons last year.

"But for this (high inflation), international financial crisis and high prices of petroleum prices in global markets are to blame. Besides, droughts and floods in some parts of the country last year also affected our economy as whole," Singh said.

Monsoon accounts for a bulk of rains India receives and nearly 66 percent of the country`s agriculture sector depends on rains for cultivation.

High food and fuel prices fuelled overall inflation to over 10 percent in February and provisional numbers for April put it at 9.59 percent.

"As a result of steps we have taken, there are signs of prices showing a moderating trend," Singh said.

"We are closely monitoring the situation and together with state governments take all steps to bring down prices and protect the vulnerable section of our society from the impact of high prices," Dr Singh added.

Food inflation, which had shot above 20 percent in December has since moderated but is still above 16 percent.

About the government’s performance, the Prime Minister described the first year of UPA-II as one of "reasonable achievement".

"I believe that the record of our first year of UPA-II is a record of reasonable achievement. I am the first person to admit that we could have done more," Singh told reporters.

He said one should not be satisfied with "what we have achieved".

"There is always room for improvement and for better outcome. But I do believe that the record of our first year is a record of reasonable achievement," he added.