Buoyed by the impressive first half growth in the economy, Planning Commission Deputy Chairman Montek Singh Ahluwalia on Friday said the country's economic growth will reach the pre-crisis levels of nine per cent starting FY 12.
"This year we had set a target of 8.5% (for GDP growth), certainly that will be exceeded based on first half numbers. We are hoping that next year, we can get back to nine per cent...the record up-till now is quite impressive," Ahluwalia said addressing a lecture at the Indian Institute of Technology, Bombay.
The country's economy had witnessed a nine per cent growth per annum for four years prior to the beginning of the global financial crisis in 2008, which had slid to 6.7% and 7.4% in the past two years as the globe was coming out of the crisis, Ahluwalia said.
President Pratibha Patil had yesterday said that the Indian GDP growth will be up to 10% in FY 12 while other agencies, including the Ministry of Finance, have been upwardly revising our growth target since the GDP growth number of 8.9% for April-September period came in earlier this month.
Asserting that a widening trade deficit is not worrisome, Ahluwalia said the country can comfortably sustain with a three per cent deficit in the current account every year for the next decade.
Traditionally, India's current account deficit has been one per cent, Ahluwalia said, "I am making a projection that India can run a bigger deficit which can be financed by long term reliable capital flows...mainly FDI flows."
The challenges before the economy in the next decade, Ahluwalia said, is making the growth inclusive, volatile energy prices, inefficient usage of water and the rapid urbanisation.