India has the potential to register economic growth of 8-9 per cent for several years by hugely investing in infrastructure, Planning Commission Deputy Chairman Montek Singh Ahluwalia on Wednesday.
"To achieve nine per cent growth in the coming years, it is going to require humongous efforts and a lot will depend on what happen to the global economy, none of which looks very positive right now.”
"We have to recognise that exports will be lower [due to slower economic growths in Europe] and we have to recognise if we want to achieve a lot of GDP growth we need to address a lot of supply side constraints and I think those are the real constraints," he said while delivering a lecture on 'Challenges Before the G20'.
India has the capacity to grow its economy between 8-9 per cent for several years if it addresses the supply constraints, largely by investing in its infrastructure, said Ahluwalia added.
Though India has seen some significant increase in foreign investments, it has opened its economy to global investors late and the accumulative investment was still lacking, he noted. "India is under invested," he added. He stressed on the need to develop the Indian infrastructure to support a strong economic growths in the coming years.
The growth for the next five years will face challenges of slower global economic environment and exports to European markets, he noted. The Indian economy growth was expected to pick up to 7.6 per cent for the current fiscal year as stated in the Budget from 7 per cent in the just ended 2011-2012 year, he said in an talk at the Lee Kuan Yew School of Public Policy in Singapore.
"One time we had hope we would set the target for the 12th five-year development plan at nine per cent GDP growth a year. But it will not be for this year it even next fiscal year."