The Telegraph
Friday , July 6 , 2012
Since 1st March, 1999
CIMA Gallary

Growth rebound hope

Calcutta, July 5: The economy will revert to the 8-per-cent-growth trajectory in 2012-13 if Indian business houses and public sector units, who are sitting on piles of cash but are hesitant to make investments, unlock the money, home minister P. Chidambaram said.

“If we address their causes and the reasons behind declining domestic savings rate, growth will bounce back. The economy has a high propensity for growth. The government will have to create suitable opportunities to bring out those cash (ones with corporate houses) for investment,” he said.

“Indians are very good savers. Investors worldwide look to India as a potential investment destination. There are doubts about the Indian market, but that would soon go away. I am confident that India will return to an 8-per-cent-plus growth rate. We think we have identified the causes of decline and the Prime Minister, who now holds the portfolio of finance, will take a number of steps to address those causes,” he said.

Chidambaram, a former finance minister, said when the UPA’s first term came to an end, India was in the grip of a financial crisis but still attained over 8.5 per cent growth on an average. In the first year of UPA II in 2009-10, growth hovered around 8.4 per cent followed by the same number for the next year. “Year 2011-12 was a very difficult year and growth declined to 6.7 per cent,” he said.

Chidambaram hailed the cabinet decision to export wheat stating that India had excess crop and there was a necessity to empty storage space before the kharif crop.