New Delhi, July 19: The finance minister, Mr Pranab Mukherjee, would be a happy man even if the Indian economy grows at 8.5 per cent this year, even though IMF expects India to clock 9.4 per cent. The minister said he prefers to be conservative in growth projection as any unexpected global crisis could impact India.
“We always have dispute with the IMF. I was inclined to accept the IMF assessment for India’s growth for the year when they projected it 9.4-9.5 per cent. But still I am being conservative in my assessment. I will be happy with 8.5 per cent plus growth, because always there are uncertainties in the international economy today,” Mr Mukherjee said in his address at the Financial Inclusion Summit, organised by CII. He referred to how subprime crisis in some banks in the US pulled the whole world into a financial crisis only in five months, which was compared to the Great Depre-ssion of the last century.
The finance minister pointed out how both IMF and EU are threatening Hungary that they would not come to its rescue if it doesn’t implement their budgetary cuts. “Eurozone crisis, if confined to Greece and a couple of other countries, is not going to affect us. But if it assumes larger proportions and dimension, if it engulfs Europe as a
whole, I don’t know what may happen,” said Mr Mukherjee. He
said that the Indian economy has shown resilience.
The IMF had two weeks ago upgraded its estimate of India’s GDP growth to 9.4 per cent from 8.8 per cent. This is the most optimistic projection of India’s growth in the current year.
The IMF had said robust corporate profits and favourable financing conditions were contributing to India’s accelerated growth.
The finance minister said that globally he has heard appreciation of India’s banking structure and that is why India opposed the demand for taxes on the banks as proposed by some of the European nations.