World Bank sees India's growth rate in 6-8% range

Excerpts from What's Hot on CNBC-TV18 Watch the full show » RELATED NEWS Indian mkts set to make new high over next 12-mth: AMP Cap Nifty BSE | NSE 30/05/12 Are Mutual Funds betting on Nifty?

A year after the collapse of Lehman Brothers, the World Bank believes that the Indian economy has fared much better than others, essentially because of the relatively low level of integration with the world economy.

CNBC-TV18's Siddharth Zarabi caught up with Roberto Zagha, the Country Director for India at the World Bank, to ask him whether the Indian economy was out of the woods.

Zagha said the Indian economy has done much better than others and its growth rate will be anywhere between 6-8% depending on what happens to the global economy and what happens domestically.

Here is a verbatim transcript of the exclusive interview with Roberto Zagha on CNBC-TV18. Also watch the accompanying video.

Q: Is the Indian economy out of the woods?

A: I think out of the woods is a complex statement. The Indian economy has done much better than others and its growth rate will be anywhere between 6-8% depending on what happens to the global economy and what happens domestically.

So India has fared much better than the industrialized economies and much better than any other developing economy. India should be very satisfied with this performance.

Q: The World Bank adopts a four-year country strategy. The country strategy for India began 2009--would last till 2012. It is coterminous in some ways with our own five-year annual plans. The planed targets are being sort of not exactly reviewed but there is a mid-term review which is happening. Much of the objective of that plan will be reoriented especially given the current economic situation. What happens to the country strategy?

A: The goals of the plan will not change. The phasing and the timing may change, and not dramatically. We would just adjust to whatever changes come up in the plan.

Q: What is the status of talks that have apparently been held in the past? India has been demanding a greater say at the high table. Is India's stance justified? Do you personally support it? What are the imperatives there?

A: The International Monetary Fund (IMF) and the World Bank were created after World War II. The configuration of economic power at the time was very different than it is today.

Developing countries, particularly China and India, have an increasingly large share of the global GDP and economic influence is increasingly important. A symptom of that, not only of importance of India and China but also the importance of developing countries in general, when the crisis erupted in September 2008, the heart attack of the world financial system, the first reaction was not the G-8 or G-7 or G-2, it was the G-20. This, I think, was because the leaders of the time understood that it was an integrated approach to the global economy. India and China are a very important part of that.

So, if you ask whether India and China's desire to have more representation in international bodies, is it justified? If economic influence is a criteria or parameter to decide voice, the answer is unambiguously yes.