Oct. 7: India is targeting double-digit economic growth by 2012, buoyed by an estimated near nine per cent growth in the first quarter of the current financial year, the finance minister, Mr Pranab Mukherjee, said.
The challenge now is to quickly revert to the high GDP growth path of an average of 9 per cent plus and even find the means to cross the double-digit growth barrier in the coming years, Mr Mukherjee said at the 7th annual India Investment Forum meeting on Wednesday.
The Indian economy grew by 8.8 per cent in the first quarter of fiscal 2010-11. The government believes growth is likely to surpass the budgetary target of 8.5 per cent this fiscal. The finance minister said the government was committed to further economic reforms and making the growth process more inclusive.
We are looking to address the weaknesses in our systems, structures and institutions at different levels of governance, making the public delivery mechanisms more robust and transparent, and sharply focussing on the role of the government as an enabler, he said.
On the financial sector reforms, Mr Mukherjee said the government has decided to set up a the Financial Sector Legislative Reforms Commission to rewrite and clean up the financial sector laws and bring them in line with the requirements of the sector. He also pointed out that the government has decided to set up an apex-level Financial Stability and Development Council (FSDC) to strengthen and institutionalise the mechanism for maintaining financial stability in the country.
Without prejudice to the autonomy of regulators, this council would undertake macro prudential supervision of the economy, including the functioning of large financial conglomerates, and address inter-regulatory coordination issues, said Mr Mukherjee.
It will also focus on financial literacy and financial inclusion. We hope to institutionalise these arrangements very soon. Reiterating the government’s commitment to reform banking and financial sector, Mr Mukherjee said it would be done taking into account the local requirements. Banking sector is in the radar after the global crisis. The fact that India has not gone through any financial turbulence as a result of the earlier phase of financial deregulation is a testimony to the view that reforms in global standards have to be adapted locally, he added.