Indian growth prospects favourable: FM

Finance Minister Palaniappan Chidambaram says India looks set to sustain growth of more than 8 percent a year.

India looks set to sustain growth of more than 8 percent a year, Finance Minister Palaniappan Chidambaram said on Sunday.

HT Image

In a statement to the International Monetary Fund's main policy-making committee, he said inflationary pressures had by and large been contained so far by appropriate monetary policy action and supply side measures.

"The prospects of sustaining a growth rate of over 8 percent, achieved during the last three years, appear favourable.

"Business confidence and corporate performance continue to be favourable. The investment boom is continuing for the third year in a row. Strong fundamentals helped the economy negotiate effectively the recent stock market volatility, and underlying investment sentiment in the financial markets continues to remain positive," Chidambaram added.

Describing movements in the foreign exchange market as orderly, he added: "Despite the surge in the oil import bill, the external current account situation is manageable, underpinned by robust exports and invisible receipts, and capital flows."

The minister said he was committed to continuing the process of fiscal consolidation in 2006-07 and beyond.