Warning that oil price pressures will pull down growth prospects and fuel inflation, Finance Minister P. Chidambaram today pegged India’s GDP growth for this fiscal lower than the earlier projection of over 7 per cent.‘‘Our growth rate ought to have touched and perhaps exceeded 7 per cent. But I am afraid if oil prices rule at this level we would have to be content with growth between 6-7 per cent,’’ Chidambaram told BBC .Although 6-7 per cent growth was regarded as high when compared to most other countries, he said it was not ‘good enough’ for India.‘‘A $5 a barrel increase in oil prices will retard GDP growth by 0.5 per cent. More than that it will also contribute to inflation by about 1.4 per cent,’’ he said.‘‘That’s why I blame oil prices and I very severely criticise what oil producing countries and some speculators are doing by raising prices to these unjustified levels,’’ he said expressing concern over the rise in international oil prices to over 50 dollar a barrel.On the comparative impact of oil price rise on India and China, Chidambaram said, ‘‘oil price hike will hurt both China and India. Oil prices will retard growth in every country of the world. That’s no consolation.’’On whether it poses political difficulties for the government due to Left pressure, Chidambaram said, ‘‘I think everyone in India, and that includes the Left wing, knows that oil prices are beyond our control.’’‘‘We don’t determine oil prices. Our dependence on imported crude is about 70 per cent of our requirement. Therefore, the very poor, even the unlettered know that this is something beyond the control of the government. That’s why they are tolerant,’’ he added.On the Left opposition to an FDI hike, he said, ‘‘Left is not philosophically opposed to forign direct investment. West Bengal, ruled by the Left, asked me to pose several projects to the World Bank, to DFID in the UK and to help them attract foreign investment.’’‘‘What they say is, as best as I have understood, that please convince us that the FDI that you are looking for will help this sector technologically or in terms of new management skills or in terms of new products or in terms of new markets. The Left is not opposed to FDI in power, in petroleum, in ports, in airports,’’ he said.
