India entered the club of the world's hottest growth economies on Thursday when government data confirmed that the gross domestic product (GDP) grew by 9.4 per cent in 2006-07.
Finance Minister P Chidambaram said in a statement, "The time has come to shed lingering doubts about the sustainability of high growth, and scepticism about the shift to a higher growth trajectory."
The economy, powered by double-digit growth in manufacturing and services, surpassed the government’s forecast of 9.2 per cent in overall growth. Agriculture, however, closed the year with a measly 2.7 per cent growth, down from 6 per cent in the previous year, when overall growth was 9 per cent.
Manufacturing grew by 12.3 per cent in 2006-07 against 9.1 per cent in the previous year, while trade, hotels, transport and communication grew by 13 per cent against 10.4 per cent.
Former RBI governor Bimal Jalan said, "The growth is very good and better than expected. But long-term issues like agriculture need attention."