FM projects over 7% growth

Asserting that India will pursue deeper and stronger fiscal consolidation and reforms, Finance Minister P Chidambaram today said the government was confident of achieving a growth rate that is better than the present high level of 7.1 per cent.

"In the coming years, we are committed to deeper and stronger fiscal consolidation and reforms, and are confident that growth will accelerate from the current levels," he said, addressing the IMF's policy-setting International Monetary and Financial Committee (IMFC) meeting here.

"India's outlook for 2005-06 continues to be very positive. With buoyant industrial production, strong credit growth, improved business sentiments, increased efficiency gains in the corporate sector, stronger trade performance, and continued robustness in the services sector, we expect to achieve a growth rate of 7.1 percent or more in the current fiscal year," the minister said.

Despite the severe impact of global oil uncertainties, a judicious combination of monetary and fiscal measures have helped in maintaining inflation at moderate levels, Chidambaram said. Stability has been maintained in the financial and foreign exchange markets.

Capital flows have remained robust and the Indian Rupee continues to demonstrate adequate flexibility in response to global currency market developments.

Quoting findings of IMF's World Economic Outlook, he said India was well poised to become a leading driver of global growth given its favourable demography, expanding domestic market and rising disposable incomes.