The finance minister says even in an unsupportive global environment India would be the only economy that moves towards 8% growth rate
article source: Livemint – June 24, 2016Beijing: Making a strong pitch for Chinese investments in India’s expanding infrastructure sector, finance minister Arun Jaitley on Friday said India will be the only economy in the world which is poised to grow at 7.5-8% in an “unsupportive global environment”.
Addressing the ‘Invest in India’ business forum, Jaitley said, “In the immediate future we will certainly maintain the growth rates which we have”.
“Hopefully if there is good monsoon this year, which is expected to be, we have a potential to improve upon those growth rates. Even in an unsupportive global environment we probably would be only economy which moves up towards 7.5% and more towards the 8% growth rate,” he said referring to the International Monetary Fund downgrading global economic growth.
“In a supportive global environment if things change for the better I do not know what the rate itself would be. But I am assuming that the global environment would remain the same,” he said, laying out a detailed road map for massive development of rural and urban infrastructure across India.
“Therefore, India in these road maps offers an attractive opportunity,” he said at the meeting attended by a large number of top Chinese bankers and wealth fund managers. “…this size of the economic activity is now going to carry on and expand in the next few decades,” he said, inviting Chinese firms to step up investments in India.
Outlining a host of measure initiated by his government, Jaitley said the goods and services tax (GST) bill which is pending in Rajya Sabha is expected to be passed soon.
“We are now trying to bring direct taxes down and the corporate tax to a highest level of 25%. The first significant step in this regard has been taken. Over the two to three years one can expect major reforms in that direction,” he said.
“Indirect reform is pending before Parliament and I hope to see it through very soon. It is called goods and services tax. We had a major challenge about resource allocation in India. We completely distanced the government from allocation and allowed the market mechanism now to determine that,” he said.
Elaborating on “emphasis areas” of development in India in the next few years, the finance minister said, “The first emphasis area is going to be infrastructure creation. And for a large number of Chinese investors present here, I think having gone through that experience in China, we are now passing that phase where there is massive infrastructure programme which is on India. Part of the infrastructure programme we are building rural roads, national highways.”
“Seven hundred thousand villages in India are going to be connected with regular road by 2019,” he said. “This year we are building about 10,000km of national highways. That is the pace at which the changes are being carried on,” he said, adding that plans are afoot to build more airports and sea ports. PTI