In the wake of India losing the fastest growing major economy tag to China, NITI Aayog vice-chairman Arvind Panagariya on Friday said the country’s ‘fragile economy’ has been turned around in the last three years, insisting that India is poised for an 8 per cent sustained growth rate within a few years. “Modi government had inherited a rather fragile economy. We will grow at 7.5 per cent in the current year and before present term of the government ends, I would expect we would touch 8 per cent mark and probably enter another sustained growth trajectory of 8 per cent plus by the time government completes its term,” Panagariya said at a press conference.
The NITI Aayog vice-chairman’s comments came after India’s GDP growth rate slipped to 6.1 per cent in the January-March quarter of last fiscal. On the other hand, China registered 6.9 per cent growth during the same quarter.
Owing to poor performance of manufacturing and services sectors, India’s growth plunged to a three-year low of 7.1 per cent in 2016-17. The GDP growth rate was at 8 per cent in 2015-16, while it was 7.5 per cent in the previous year.
The government’s decision to demonetise highter value currency last year also had a significant impact in disrupting economic activities across the country, leading to a severe cash crunch.
On Thursday, Finance Minister Arun Jaitley had, however, maintained that the decline in fourth quarter GDP print cannot be attributed to demonetisation alone and that both domestic and global factors were responsible for the slump. Jaitley also insisted that the country’s growing at 7-8 per cent was “fairly reasonable” in the current global context.
With PTI inputs