Exuding confidence about India's potential, Planning Commission Deputy Chairman Montek Singh Ahluwalia on Tuesday said the economy will get back on the targeted growth trajectory of 8 per cent after two years.
"I think we can hit what we thought was our trajectory two years later because of the slowdown that we have," Montek told reporters at the 34th SKOCH Summit in New Delhi.
The economy expanded at a decade-low rate of 5 per cent in the first year of the 12th Plan (2012-17) period, during which the government has targeted an annual average growth rate of 8 per cent.
In the April-June quarter of the current financial year, economic growth slowed to 4.4 per cent, compared with 4.8 per cent during January-March. Growth was 5.4 per cent in the April-June period of the previous financial year.
"I believe that the long or medium term growth potential of the economy remains 8 per cent, provided you do all things outlined in the 12th Plan. Obviously, the first two years are not going to be at that level," Montek said.
According to him, the average economic growth rate in the 12th Plan period will be lower than 8 per cent and the Commission will make its estimate next year during the mid-term review of the five year policy.
Montek said he expects growth to improve in the second-half of the current financial year.
"The second half of the year should be better. The first half was lower. So for the year as a whole to be better than 5 per cent, the second half has be really good. We don't know the numbers," he said.
Asked whether the slowdown is over, he replied, "I believe that the economy has bottomed out. The financial experts say that there will be turnaround. It is clearly not a strong rebound. But there is evidence that (there will be turnaround)."
India's exports in October grew 13.47 per cent to $27.2 billion, the fastest pace in two years, government data showed on Monday.
"The news on the exports front is very encouraging," Montek said said.
He said the current account deficit will probably be lower than the target set by the Finance Minister. The deficit refers to the difference between outflows and inflows of foreign currency.
"He (the finance minister) himself said that instead of $70 billion, it would be $60 billion...The important news is that it would be much lower than $88 billion last year. That means we need less money. That should increase the assessment of micro-economic stability," he added.