New Delhi:India hopes to maintain the present level of economic growth despite a global slump as a steep fall in exports has been arrested in the last two months and industrial output looks promising, senior government officials said on Wednesday. Finance minister Pranab Mukherjee told Parliament that economic growth was showing signs of improvement, and commerce and industry minister Anand Sharma said efforts were being made to reduce the trade deficit.
Asia’s third largest economy grew by 6.7% in fiscal 2009, and Mukherjee said: “I do hope this level of growth we will be able to maintain.” He said steps taken since late 2008 by the central bank and the government had prevented a further deterioration in the economy.
Sharma said efforts were being made to diversify India’s exports and explore new markets in Africa and Latin America. Exports started declining in annual terms in October, and were down 29.2% in May from a year earlier.
The Indian economy is mainly domestic-demand-driven and the latest infrastructure data has shown improvement in economic activity in recent months. “It (June industrial data) looks promising. We expect improvement,” industry secretary Ajay Shankar said.
He also said an improving economy should attract more foreign direct investment (FDI). “We think, with liquidity improving globally and confidence in the Indian economy rising, these numbers should pick up.”
India got about $2.2 billion (Rs10,670 crore) in FDI in May, he said. FDI rose 11% to $27.31 billion in fiscal 2009, while the inflows in the first two months of the current fiscal stood at $4.43 billion.