Chidambaram is hopeful of India's economic prospects

Washington, Apr 13 (UNI) Finance Minister P Chidambaram is upbeat about India's economic prospects, saying that GDP growth, driven by domestic demand, remains robust so far with somewhat moderation to 8.4 per cent in the third quarter of 2007-08.

Addressing the International Monetary and Financial Committee here yesterday, he said India remained committed to economic reforms and conduct of macroeconomic policy to enable continuation of the growth momentum with stability.

He touched the same subject at his meeting in London on Thursday and said he was confident of India ending 2007-08 ''pretty close'' to the post-2004 yearly average of 8.8 per cent growth.

The IMF, in its Economic Outlook, has predicted slower growth rate of 7.9 percent in 2008-09. ''But, we are confident we can still register a growth rate of over eight per cent,'' the Minister said.

Mr Chidambaram told the IMF yesterday that inflationary expectations remained contained but, headline inflation rose above the projected tolerance level of five per cent recently, reflecting higher food, fuel and other commodity prices, particularly metals.

He, however, said strong capital inflows and their volatility continued to pose significant challenges. Equity markets have exhibited greater volatility mirroring global trends.

He talked of continued buoyant revenue collection and improved fiscal marksmanship and said, fiscal targets set in the fiscal responsibility legislation were being met.

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