FY11 growth seen at 8.5%, FY12 at 9%: Montek Singh

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India has the capacity to grow at 9%, said Planning Commission Deputy Chairman Montek Singh Ahluwalia told CNBC-TV18. He foresees gross domestic product (GDP) growth at 8.5% and 9% for FY11 and FY12, respectively.

According to him, infrastructure constraints need to be taken care of.  "We need to step up investment in infrastructure in the next two years. Public investment in infrastructure is likely to go up in the kind of projects that private sector won't support."

Export growth will not be as fast as it was in the last five years, he stated. "The government is concentrating on how to make growth more inclusive." He added that fiscal stimulus needs to be gradually withdrawn.

On inflation, he said Wholesale Price Index (WPI) inflation is likely to come down in the next two months. "We are looking at a very good Rabi output for wheat. The government will take measures to tackle food inflation.""

Ahluwalia is likely to meet Prime Minister Manmohan Singh with a mid-term review plan on March 20.