India is unlikely to return to 9 per cent growth rate before 2012 as the global economy is expected to take at least two more years to recover.
"It would be unrealistic to expect that the average growth rate over the next five years would be 9 per cent. A more realistic assessment would be that India would revert to the 9 per cent growth rate by the end of the Eleventh Plan (2011-12)," former RBI Governor S S Tarapore said.
At an event organised by Dan & Bradstreet last evening, Tarapore said it would be necessary for the global economy to recover fully for the economy to revert to 8.5 to 9 per cent growth path.
Welcoming the government's plans of stepping up investments in public and private sectors, he said that as these sectors have a long "gestation lags", increased investment in these sectors could not be reflected in an immediate increase in output.
The present government, he said, has quite correctly given a policy tilt to poverty alleviation, thereby emphasising the quality of GDP growth.
"A basic dictum of microeconomic policy is that the pattern of investment determines the pattern of output and the pattern of output, in turn, determines the distribution of income," the former banker said.
