"The latest estimates of agricultural production have come in and the economy has grown close to 9.1 per cent," Chidambaram told the Lok Sabha during the debate on the trust vote.
Fiscal 2007-08 was a watershed year for the Indian farm sector with food grain production reaching a record of 230.67 million tonnes, up 6.16 per cent over the previous year.
The first (advance) estimate of GDP growth for 2007-08, released on February 7, pegged it at 8.7 per cent. This number was subsequently revised to 9 per cent in the revised estimates released on May 30 this year. The third (quick) estimate for the year will be released by the Central Statistical Organisation (CSO) on January 31 next, followed by a final number around a year later.
Today's announcement by Chidambaram would be the Finance Ministry's estimate based on their calculations on the back of better farm output, but not the official quick estimate, a CSO official said.
Chidambaram termed the current fiscal year (2008-09) as a difficult one and said growth would ease, but stay above the long term aim of 7-8 per cent. "This government will ensure that economy will grow at 7-8 per cent compared to an average growth of 5-6 per cent when the National Democratic Alliance (NDA) was in power," he said.
India's gross domestic product grew a record 9.6 per cent in 2006-07, the fastest economic expansion in 18 years.
Global economic woes and the sharp spike in crude oil prices have contributed to record levels of inflation in recent months (the wholesale price index annual rate of inflation is projected at almost 12 per cent, leading to the Indian central bank tightening monetary policy in an attempt to curb price rise and dampen inflationary expectations. The tighter liquidity scenario and its resulting impact is seen through lower consumer spending and a decline in corporate earning margins.
"The record agricultural output has come through farsighted plans of the government. We launched the National Horticultural Mission and the National Food Security Mission, undertook the repair and maintenance of water bodies and introduced the National Rainfed Area Authority", Chidambaram said.
Chidambaram added that under the UPA government, the rate of capital formation in agriculture has increased from 10.2 per cent (2003-04) to 12.5 per cent (2006-07). "We will achieve a growth rate well than what was promised under the common minimum programme and much better than the NDA government," he said.
