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'Slowdown not disastrous, can achieve 7 pc GDP in FY'10'

PMEAC says India can achieve a seven per cent growth rate in the next fiscal despite a global financial meltdown impact.

business Updated: Dec 31, 2008 19:29 IST

As India walks past a tumultuous year to enter 2009, the country's top think tank PMEAC on Wednesday said the country can achieve a seven per cent growth rate in the next fiscal despite a global financial meltdown impact.

"It is a slowdown, but not as disastrous as being talked about," chairman of the Prime Minister's Economic Advisory Council Suresh Tendulkar told PTI while speaking about the growth prospects and challenges for the government in 2009.

"If we are able to push investment in the infrastructure sector, we can be having seven per cent growth in the next fiscal. However, we need to cut cost and increase productivity to push growth," he said.

As regards the current fiscal, Tendulkar said, the council will revise its growth projections for 2008-09 in the wake of the global crisis and its direct and indirect impact on the country.

PMEAC, which had earlier projected a growth rate of 7.7 per cent, will come out with revised projections in January. The country witnessed a growth rate of 9 per cent in 2007-08.

Assocham President Sajjan Jindal also said the economic recession has touched its bottom and fiscal 2009-10 will bring in better economic scenario for the country.

According to the World Bank projections, India is likely to clock a GDP growth of 6.3 per cent in the current fiscal, which can slip to 5.8 per cent in 2009.

The International Monetary Fund too in its November update of the World Economic Outlook scaled down the growth forecast for India for the current year to 7.8 per cent from 7.9 per cent and for 2009 to 6.3 per cent from 6.8 per cent.

However, the World Bank has projected shrinking of the global trade by 2.1 per cent in 2009 that could have implications for Indian exports, which after a period of seven years, registered a negative growth of 12.1 per cent in October.