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India's GDP to grow 8% during Tenth Plan

The Planning Commission projected that India's gross domestic product would grow eight per cent during 2002-07 and would rise to 9.4 per cent thereafter. Meanwhile, a Central Statistical Organisation report said on September 30 that India's economy grew at an impressive six per cent in the first quarter of 2002-03 compared to just 3.5 per cent in the same period last year.

The projections, which are part of the draft Tenth Plan document to be presented before the full Planning Commission chaired by Prime Minister A B Vajpayee on October 5, also envisage that investment rate would be pegged at 36.14 per cent after 2007 while domestic savings would escalate to 33 per cent, which would push GDP growth to 9.4 per cent.

The higher growth projections are despite the fact that India failed to achieve the targeted 6.5 per cent annual growth during the Ninth Plan and ended up with 5.35 per cent.

The country achieved higher growth rates in the previous three Plan periods -- 6.68 per cent during the Eighth Plan (1992-97), 6.02 per cent in the Seventh Plan (1985-90) and 5.54 per cent in the Sixth Plan (1980-85).

The plan panel pitched for higher growth during the Tenth Plan and thereafter on the assumption that investment rate would go up to 28.41 per cent during the Plan period and further to 36.14 per cent thereafter.

The savings rate is also assumed to go up to 26.84 per cent in 2002-07 and then to 33.01 per cent in the post Tenth Plan period.

According to the Planning Commission's approach paper, India's current account deficit is estimated to increase to 3.13 per cent after 2007 from 1.57 per cent during Tenth Plan and 0.91 per cent in the Ninth Plan.

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