Search:



The Web

Rediff








 Latest Business news on mobile: sms BIZ to 7333

Home > Business > PTI > Report


RBI's growth forecast realistic: Manmohan

May 18, 2004 15:04 IST
Last Updated: May 18, 2004 15:42 IST


Terming the 8.1 per cent growth in 2003-04 as "inflated", Congress on Tuesday said the Resrve Bank of India forecast of 6.5-7 per cent for the current year was "realistic".

The Monetary and Credit Policy 2004-2005

"I think 6.5-7 per cent growth projections by RBI in its slack season Credit Policy unveiled today is realistic," senior Congress leader Manmohan Singh told reporters.

The 8.1 per cent growth last financial year was inflated due to steep increase in agriculture production after a very severe drought in the previous year and "that cannot form a basis for a conclusion that we are now on a trend growth rate of eight per cent."

"So the over 8 per cent growth is certainly an aberration," he said declining to comment on the RBI decision to keep the bank rate unchanged at six per cent saying he was yet to go through the Credit Policy.

Asked whether it would be difficult to achieve average annual growth rate of eight per cent during the Tenth Plan period, Manmohan Singh said, "I won't say it is impossible... India can achieve much higher growth rate."

"We have to work towards that goal, we need to design our policies to promote savings, investments and competitiveness," he said.

He said controlling inflation was a "national priority" and therefore "we will have to watch the price trends as rising prices have a bearing on inflation rates."

To a question on the decision of the Congress government to supply free power to farmers, Singh said the general approach was that there should be user charges.

Regarding the specific problem of farmers in Andhra Pradesh, Singh said the farmers in the state have had a "raw deal" for many years because of drought and other policy variables.

Therefore, he said, "I think some amount of comfort was necessary but that does not mean there should be no user charges."

Regarding the Common Minimum Programme, Singh said the draft was ready but he and other senior colleagues of the party have not had the time to discuss it with the party allies.

On lifting sectoral caps on foreign direct investment and abolition of POTA as demanded by its Tamil Nadu allies, Singh said his government would do whatever was necessary in the national interest.


7333: The Latest News on Your Mobile!

© Copyright 2005 PTI. All rights reserved. Republication or redistribution of PTI content, including by framing or similar means, is expressly prohibited without the prior written consent.

Share your comments




Article Tools
Email this article
Top emailed links
Print this article
Write us a letter
Discuss this article



Related Stories


Don't panic, says Manmohan

No more bear hugs, warns Cong

Cong repeats reform credentials



People Who Read This Also Read


Naidu, India's leading reformer

India Inc goes gaga over Singh

'Trishul will follow Gehlot'







Copyright © 2005 rediff.com India Limited. All Rights Reserved.