Economic growth to be above 8 pc: Chidambaram

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SME Times News Bureau | 06 Jul, 2012
Exuding confidence that the Indian economy will bounce back to a growth rate of above 8 percent, union Home Minister P. Chidambaram said Thursday steps have been taken to promote savings and ensure that India remains an attractive destination for foreign investments.

"The year 2011-12 has been a difficult year when our growth declined to 6.7 percent. We think we are identifying the causes for the decline and will take a number of steps to address those causes. I am confident thatin 2012-13, the rebound will start and soon we will be back to the 8 percent plus growth rate," said Chidambaram at an event in Kolkata.

He assured that steps have been taken to promote savings and ensure that India remains an attractive destination for foreign investments.

"Foreign investments will not go away simply because we are in despair. Last year, the difficult year India attracted foreign investments worth USD 46 billion of foreign investments. That's the highest in recent years. The current economic situation requires cool heads to come together and address the fundamental causes of the problem," he said while addressing a programme of the Calcutta Chamber of Commerce.

He said the high propensity of the Indians to save will catalyse the growth of the economy.

"The basis to say that the economy will bounce back is the fundamentals of the Indian economy. The propensity of the Indians to save still remains high. Moreover many business houses in the country are sitting on pile of funds," said Chidambaram, a former finance minister.

He pointed out India still has huge appetite for investments.

"We should stop talking the language of pessimism. We still have very large opportunities we are still a country with a huge appetite for investments. Tell me one country which needs hundred million tonnes of steel, thousands kilometers of roads, many airports, so many hospitals like India," he said.

He said that in spite of the decline of growth and the ongoing international financial crisis which also affected India, the central government did not cut down or scrap any of the developmental programmes run by it.

"Every single major programme has been funded by the government of India. We have neither cut back nor scrapped any programme. The expenditure on these programmes like the (rural jobs scheme) MNREGA, (urban developmentscheme) JNNURM, etc was Rs.48,213 crore in the 11th Plan which has been raised by 180 percent to be at Rs.136, 060 crore in the 12th Plan," he said.

He also said the country was amongst the fastest growing economies of the world.

"In the year 2011-12, we added 20,500 MW of additional power capacity, 34 lakh new BPL (below poverty line) families were given electricity connections, and 8,000 villages were newly electrified."