India needed a strong domestic market to deal with global shocks in this era of globalisation, Finance Minister Pranab Mukherjee said today.
“The (global financial) crisis highlighted the fact that if we have to benefit from the ongoing process of globalisation, we have to have strong domestic economic foundations, an integrated and a coherent policy approach to protect and promote national interests,” Mukherjee said at the annual function of industry chamber Assocham.
The finance minister also said the country would have to take a balanced, broad-based approach to its development process and deepen and broaden the domestic market so that it could handle the shocks and uncertainties of the global economy just as well as the periods of expansion and boom.
In the last five years, the gross domestic product (GDP) of the Indian economy has grown at 8.5 per cent per annum, despite a significant dip in growth in 2008-09, on account of the global slowdown. “Underpinning this performance are a number of factors that will serve as sources of strength for the years ahead,” Mukherjee said.
According to him, savings and investment rates have picked up, the industrial sector has demonstrated the capacity to compete with the best in the global economy, both domestic and international investors have shown confidence in the evolving policy framework and the fundamentals of the economy; and there is steady expansion in domestic demand.
“Most importantly, the revenue buoyancy in the wake of this growth has come with a renewed public capacity to address the chronic problems of unemployment and poverty that have plagued our economy and the society,” Mukherjee added.
