In the wake of the grim domestic and global economic situation, the top government advisory body — the Planning Commission — on Thursday felt that attaining the target of 9% economic growth in the 12th five year plan (2012-17) would be difficult. But in spite of that view the plan panel refrained from revising the target.
“We are not revising the GDP growth target of 9% for 12th plan as of now,” said a senior plan panel official, after a day-long closed-door meeting held at Central for Scientific and Industrial Research (CSIR) conference room.
The government had already lowered the economic growth target from 9.5% to 9% for the plan considering economic slowdown in United States, eurozone crises and uncertain foreign investment flow into India.
The fiscal deficit is expected to be more than 5.5% for the current financial year as against the target of 4.6% leaving very less scope for the government to provide additional funds for reviving economy and developmental projects.
The increase in funds for developmental schemes would be around 10%, less than the average inflation for the year, in the budget to be tabled in March after results of elections in four states are announced.
In light of these facts, Planning Commission deputy chairperson Montek Singh Ahluwalia discussed the economic prospects for the 12th plan with most members being of the view that revival of economy would take more time than expected.
“The meeting was held to reflect the changing dynamics of domestic and global economic scenario and its impact on the country’s future prospects,” said Planning Commission member Arun Maira.
Members made presentation on the projected impact of the slowdown in different sectors of the economy and discussed ways to tackle the situation.