India to grow much faster with higher rainfall forecast this year: FM Arun Jaitley

NEW DELHI: India’s current growth rate of 7.5% is not enough as per its own requirement standard and the country has the “potential” to do “better”, Union Finance Minister Arun Jaitley has said.

Jaitley further said that India may grow at a much faster pace if the rainfall predictions are right. Speaking at the Carnegie Endowment for International Peace event in Washington on Wednesday he said that he has seen in the last two or three days the predictions seem to be much kinder to India this year, and if that were to happen, India is capable of…improving upon our growth rate,” Jaitley said.

Expressing concern over the decline in India’s exports, Jaitley said the country’s growth parameters were on track and the government is moving ahead on its reform agenda with inclusiveness and successfully meeting all its fiscal parameters.

“On 7.5% by global standards or by world standards in the current situation are we doing well? The answer is Yes. But by our own requirement standards are we doing well enough? I think, we can do better,” Jaitley said.

“The fact that in this otherwise a globally adverse environment by putting some domestic policies in place, by using investments and surpluses cleverly we have managed to sustain some growth. One of the biggest areas of worry has been the declining exports,” he said.

Noting that both in value terms and volume terms, the global situation has impacted export, Jaitley, who is on a week-long visit to the US, said that things could improve if some of the variables change.

“Does 7.5 % satisfy either the Indian government, me or the Prime Minister or India’s political opinion, the answer is no. I think, by our own yardstick, we realise that we have potential in a helpful environment to do better,” he said, adding that in an adverse global situation, probably one does settle for that rate.

“But if hopefully with any of these variable factors growth returning to the rest of the world at some stage, better Indian monsoon, and continued favourable environment of oil prices and the impetus of policy direction in India, if the reforms go on…if we are able to cross those hurdles, our ability to do much better would be there,” Jaitley said.

Earlier welcoming Jaitley, Carnegie’s president William Burns, who is the former Deputy Secretary of State, said that India had a very important role to play globally, particularly in Asia.

India has surprised China by emerging as the fastest growing emerging economies of the world.

“Two years after the BJP came into power there is a change in India’s economic situation. Under the leadership of Prime Minister Narendra Modi and Jaitley India today is the world’s fastest growing major economy,” Burns said, adding that inflation was moderated and the government was committed to reforms.

Jaitley said that about two years ago when the current government had taken over the situation looked quite challenging, but since then the global situation has never been helpful.

In the 21 months the key emphasis of the Modi government has been decisiveness, consistency in terms of policy direction and transparency in functioning, he said.

“In terms of economic direction, this government is yet to commit a major mistake,” he said.

Jaitley arrived in the US capital Wednesday to attend the annual spring meeting of the International Monetary Fund (IMF) and the World Bank, in addition to meeting his Chinese and American counterparts.

During his week-long stay, Jaitley would also travel to New York to meet with private sector leaders with an objective to attract foreign direct investments to India.

(With inputs from Reuters)