9 pc growth within target for next fiscal: Kaushik Basu

Written by: Pti
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New Delhi, Feb 7 ({PTI) Encouraged by 8.6 per cent growthrate estimates for current fiscal, Chief Economic AdvisorKaushik Basu today said a 9 per cent economic expansion forthe next financial year is "well within target".

"The prospects for the world as a whole are lookingbetter but still there are uncertain clouds. In that scenariogrowth of 8.6 per cent is absolutely remarkable. So the 9 percent which we are aiming for next year is now looking wellwithin target," Basu told reporters.

On whether the inflation would affect the growthprocess, Basu replied, "I really don''t see inflationdisrupting the growth process."

He said in fact the GDP number would have a dampeningeffect on inflationary pressures.

"We have been concerned about inflation but I reallyfeel that the number we have got today is going to dampeninflationary expectation. So I am not seeing that (inflation)could jeopardise the growth story."

Basu further said that growth rate for the next twoquarters were also looking encouraging but IIP number, whichhas been fluctuating is to be looked at.

The 8.9 per cent growth in the first half of thecurrent fiscal, notwithstanding, the government is battlinghigh inflation, particularly food inflation.

The overall inflation has remained above the comfortzone of 5-6 per cent for over a year now.

The food inflation is ruling at 17.05 per cent for theweek ended January 22.

The RBI in its quarterly monetary policy review lastmonth upped the March-end inflation projection to 7 per cent,from 5.5 per cent.

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