FM8217;s concern over core sector

NEW DELHI, July 17: Seriously concerned over the sluggish growth'' in infrastructure sector, the Finance Minister P Chidambaram today exh...

NEW DELHI, July 17: Seriously concerned over the 8220;sluggish growth8221; in infrastructure sector, the Finance Minister P Chidambaram today exhorted concerned ministries such as power and petroleum to take immediate remedial action.

8220;I intend to place this matter before the cabinet committee on infrastrcuture so that the ministries concerned can pay attention to these sectors,8221; Chidambaram told agency correspondents.

The finance minister referred to the quick estimates of the Central Statistical Organisation CSO which put the GDP growth rate at 6.8 per cent during 1996-97.

8220;This is very much in keeping with the predictions I made in the budget speech this year,8221; Chidambaram said, adding 8220;it is not a cause for celebration but a cause for satisfaction.8221;

If the infrastructure sector had registered higher growth rates during 1996-97, the GDP growth rate during the year would have easily crossed seven per cent. In the previous year, GDP growth rate was 7.1 per cent.

The Finance Minister said the two positive factors in the revised estimates for GDP growth are the spurt in agricultural growth which had gone up by 5.77 per cent during 1996-97 as against minus zero point one per cent during the previous year.

Banking insurance sector grew by 6.9 per cent during the last financial year as against four per cent during 1995-96. 8220;However I give low marks for the mining sector which grew by only one per cent as against seven per cent during 1995-96.8221;

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Referring to the sluggish trends in the utilities sector electricty, gas and water supply, Chidambaram said this had grown by only 3.8 per cent last year as against 9.1 per cent in the previous year.

8220;If only these two sectors had performed about 60 per cent of the previous year, our growth rate would have crossed 7.1 per cent,8221; he said.

The Finance Minister said the real problem in the infrastructure sector in the coal, power, petroleum, gas sector.

While electricity generation increased by 3.8 per cent last year, coal sector grew by 5.8 per cent during the period.

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However, petroleum declined by minus 8.6 per cent and fertilisers by minus 1.6 per cent.