India’s economic growth is expected to pick up in the coming years following a raft of reforms such as demonetisation and the rollout of the Goods and Services Tax, although developing countries face global challenges of trade restrictions, finance minister Arun Jaitley said on Saturday.
Addressing the second annual meeting of the New Development Bank (NDB) in Delhi, Jaitley said a possible shift towards inward-looking policies and protectionism and a sharper than expected tightening in global financial conditions, the crisis in Europe and increased geopolitical tensions, posed a challenge to the emerging economies.
Citing the projections of International Monetary Fund, Jaitley said India’s GDP growth in 2016 would be 6.6%, while the same would be 7.2% and 7.7% in 2017 and 2018 respectively. The IMF projections for 2017 and 2018 corresponds with India’s financial years (April-March) 2017-18 and 2018-19.
India’s stats office, CSO, has estimated economic growth to slow to 7.1% in 2016-17 from 7.9% in the previous year. The government’s Economic Survey projects the GDP growth at 6.75-7.5% in 2017-18.
“We have successfully implemented a slew of reform measures,” Jaitley said listing out the demonetisation drive, passage of crucial bills in Lok Sabha to roll out the Goods and Services Tax, the Insolvency and Bankruptcy law, and relaxing foreign investment rules.
Jaitley said India wants $2 billion loans for various projects from the NDB, earlier called BRICS Bank as it set up by the emerging nations India, China, Brazil, Russia and South Africa.
“India has a huge unmet need for investment in infrastructure, estimated to the tune of Rs 43 lakh crore (about $646 billion) over the next five years,” he said.
About 70% of the funds will be required in the power, roads and urban infrastructure sectors, he said.
”This offers an enormous opportunity to an Institution like NDB, whose core mandate is sustainable infrastructure development. We shall work with the NDB to develop a strong shelf of projects in specific areas such as Smart Cities, renewable energy, urban transport, including Metro Railways, clean coal technology, solid waste management and urban water supply,” he summed up.