New Delhi: India’s economy is expected to grow 7% in the fiscal year to March 2009 despite the global slowdown, and will maintain a “strong pace” of expansion in coming years, the Prime Minister said on Thursday.
Asia’s third-largest economy expanded by 7.6% in the September quarter, easing from a scorching near 9% average growth in the last four years as the global financial crisis and high borrowing costs tripped up activity.
“Despite the global economic downturn, the fundamentals of the Indian economy continue to remain strong. We expect to achieve a growth rate of about 7 percent this year which will be among the highest in the world,” Manmohan Singh said in Chennai.
Economists and government advisers and officials expect expansion to moderate to around 7% this fiscal year and the central bank’s chief said last month that 2009/10 looked like being an even more challenging year.
The central bank has cut its key lending rate by 350 basis points since October while the government announced a Rs20,000 crore ($4 billion) stimulus package and cut duties on manufactured products to lift growth in a slowing economy.
“Much of India’s growth is internally driven, and I expect we can maintain a strong pace of growth in the coming years that certainly will be our ambition,” Singh said.