Riding on the back of a pick-up in investment and improved investor confidence, the Finance Ministry today exuded confidence that the economic growth will be 6 per cent and above in the current fiscal.
Riding on the back of a pick-up in investment and improved investor confidence, the Finance Ministry today exuded confidence that the economic growth will be 6 percent and above in the current fiscal.
"Let me assure you the growth rate will not be below 6 percent. Investments are picking up, there are greenshoots. The sentiment is improving, FDI is increasing. I have absolutely no doubt that you would certainly see positive movement in this," Economic Affairs Secretary Arvind Mayaram told reporters on the sidelines of ADB annual meet here.
The Reserve Bank has projected the Indian economy to grow at 5.7 percent in the current fiscal, which is much lower than the government estimation of 6.1-6.7 percent.
"I think it needs to be acknowledged that the government is fully committed to reviving the investment sentiment," he said. In its annual monetary policy today, the RBI lowered the key lending (or repo) rate by 0.25 per cent, but said the scope for further easing of policy ratesis limited.
Commenting on the RBI policy, Mayaram said: "We do not have any doubt when the next monetary policy is considered by the RBI, they would certainly see that there are adquatereasons for reconsidering the interest rates which are prevailing now and push for more growth".
He said government have been taking steps to revive investment. The Cabinet Committee on Investment (CCI) which was set up to accord fast track clearance to large projects has already approved total projects worth Rs 93,000 crore in last four months.
"We believe there will be enough incentive to certainly look positively at the rate cut. But am not predicting, I am not even demanding. I am only stating how I see the situation on the ground," he said.
Speaking to reporters at another session of the ADB, Chief Economic Advisor Raghuram Rajan said: "25 basis point is a good step. I think going forward if inflation stays low, if we can bring down food prices, hopefully they will have more room to undertake (policy rate cut)".
The RBI has said inflation is above comfort level and projected WPI in the current fiscal to remain range bound at 5.5 percent. The March WPI inflation stood at 5.96 percent, lower than RBI forecast.
Mayaram said the RBI has said there is concern on growth and therefore there is need to incentivise growth but raised concern on food inflation. Food inflation as per the March numbers was in double digit.