Indian economy to grow over 8% this fiscal: Panagariya

Jaipur: Buoyed by the improved second quarter GDP numbers, Niti Aayog Vice Chairman Arvind Panagariya on Wednesday said the economy will grow over 8 percent this fiscal.

In the first half of the current fiscal, the GDP growth stood at around 7.2 percent and is expected to cross the 8 percent-mark in 2015-16, Panagariya said.

Helped by a pick up in manufacturing, the country's GDP witnessed a growth of 7.4 percent in July-September, to become the fastest growing major economy.

The Indian economy grew at an average 8.3 percent rate during the 2003-14 period, and in 2014-15, the growth was 7.3 percent, he said while addressing the students at Malviya National Institute of Technology (MNIT) here.

The Niti Aayog Vice Chairman further said that only four countries Singapore, South Korea, Taiwan and China have a growth rate in the range of 8 to 10 percent.

Panagariya also stressed on the need to have an improved growth rate in sectors such as agriculture and services.

On overall economic growth in the country, he cited the role of five critical factors such as growth of merchandise exports, improved manufacturing and services sectors, shifting of workers from agriculture to industries and services, better wages for eliminating abject poverty and rapid urbanisation.

Terming the Niti Aayog's role as a facilitator, Panagariya said the dissolution of the Planning Commission and the formation of Niti Aayog yielded good results, and its policies are in the right direction.

On the agriculture sector, he said, "According to the 2011-12 data, the share of agriculture in employment is 49 percent while that in the GDP is 15 percent."

"The best agriculture has done over a ten-year period is 4.7 percent during 1980s, and both industries and services have been growing faster (8 to 10 percent) in the last decade," he said.

"Therefore, the share of agriculture will only decline in the future, and no fast growing economy has ever been able to reverse the trend," Panagariya added.

India needs to create a large number of jobs in industry and services to absorb agriculture workers who wish to migrate to other sectors, he added.