Finance ministry tabled Economic Survey - a report card on the economy during this fiscal in parliament at about
Maintaining economic growth at about 9% a year will be a challenge due to inflation and infrastructure constraints, and raising the rate to double digits will be even harder, the Economic Survey for 2007-08 said. Agricultural sector growth is estimated to slow to 2.6% in the year ending March 2008, from 3.8% the year before, it said. Development of adequate infrastructure is a critical prerequisite for sustaining the economic growth momentum, the survey said.
It said containing inflation was a priority, because rising prices hurt the poor, and putting pressure on interest rates hit both savings and investment. The survey said Inflation should remain moderate in the coming months due to policy measures taken over the last year.
A surge in capital inflows, including foreign direct investment, would continue in the medium term although short-term inflows may moderate due to slightly slower growth, the survey said. Any reduction in excess capital flows from the high levels of 2007 may affect the equity markets in the short term but will make the task of monetary management easier, the survey said.
Finance Minister (FM) P Chidambaram today said that he was confident of achieving 11th Plan target of 9% growth.
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