India can grow over 8-8.5%

by Dave

[Confederation of Indian Industry President and ICICI Bank Managing Director K V Kamath ] noted with satisfaction India having a strong savings rate of 34.8 per cent, investment rate of 35.9 per cent and incremental capital-output ratio (ICOR) of four per cent, better than China(4.3 per cent) and Brazil (5.1 per cent). The country had a strong domestic consumption of 6.7 per cent of GDP in 2007-08 and strong 20 per cent growth in export and foreign exchange reserves at $312 billion, he observed.

He expected the Reserve Bank of India to take ‘conservative’ measures in its credit policy later this month to check the high inflation without affecting industry gorwth. The Indian banking system was in good stead now, with cleaning up of Non-Performing Assets (NPAs) in the last ten years.

Setting economic aspirations for medium term, he said the country need to double per capita income in ten years by aspiring for a ten per cent GDP growth. Manufacturing share in growth should be increased to 25 per cent by 2020.

Outlining the development agenda for medium term, he said the country should provide better access to health, education and skills for its people, make housing affordable and develop model cities to accommodate future urban migration.

He said the CII was deepening engagement with Brazil for cooperation in agriculture, with Russia in energy and with China to build on complementary strengths in various fields.

By 2022, India could be the World’s largest pool of trained manpower, leaders in industry and commerce, accounting for 10 per cent of world trade and a source of global innovations, he envisaged.