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Growth rate will bounce back to 9%: Chidambaram

New Delhi, Tue, 07 Oct 2008 NI Wire

India’s economy is likely to grow at a rate of 8 percent this year which can bounce back to 9 percent in the next year despite global market woes, the Finance Minister P. Chidambaram said while addressing the NDTV Business Leader of the Year Awards Function last evening.

The minister cited the strong stand of Indian business and industry which would save the country from a critical global financial crisis, though he said that India would be affected to some extent.

‘There is of course a storm blowing across the world but the government will be vigilant to tackle the situation. Our regulators have shown great agility that has shown some positive signals to substantiate the growth rate,’ Chidambaram added.

Citing some impressive growth rate of different sector, he said indirect tax collections are on target at a little over 14 per cent for the period up to July 2008 while during the period April-September, 2008; personal income tax collection has grown by 23.4 per cent, by adding that corporate tax collection has grown by 35.3 percent.

Chidambaram added that during the period April-August, 2008, exports have increased by 35.1 per cent and imports have increased by 37.7 percent.

Referring to the construction sector, he said it has recorded growth of 11.4 per cent as against 7.7 per cent in the first quarter of 2007-08.

Railway revenue earning traffic has shown an increase of 9.4 per cent as against 6.1 per cent last year.

Citing the strong stand of Indian banking system, he said the lowest capital adequacy ratio in any of our banks is a little over 10 per cent while the highest capital adequacy ratio for a bank is 13.65 per cent.

“At the end of June, 2008, gross NPAs are at 2.11 per cent and net NPAs at a historic low of 0.93 per cent. During the period April to June, 2008, bank deposits have increased, year-on-year, by 23.87 per cent. Advances have increased, year-on-year, by 28.42 per cent. Time deposits, during the period April to September 12, 2008 have increased by 9.0 per cent,” he added.