India Has Standardised Itself For 7-8%, Arun Jaitley Says

India has set itself up to grow at 7-8 percent and is already a $2.5 trillion economy, Finance Minister Arun Jaitley said today.

Economic growth will move towards 7 percent in case of a slowdown and 8 percent if it picks up pace, Jaitley said at the Defence Estates Day Lecture in New Delhi.

Double-digit growth in India, however, would require a boost from global factors, Jaitley said at the HT Leadership Summit later today. A 10 percent growth will not merely depend on domestic factors, the finance minister said.

India's growth rates were modest prior to 1991, but its ability to raise revenue and capacity to increase its spend were limited, he said. The country is now moving closer to a situation where it can spend what it earns with less borrowing, he added.

The finance minister said the country has also been able to keep current account deficit under control and bring down fiscal deficit. “We have been able to keep our current account deficit under control and over the last few year India has had exemplary performance in terms of being able to bring down its fiscal deficit,” Jaitley said.

As of October, the government exhausted 96.1 percent of its fiscal deficit target, suggesting that it might overshoot its deficit target of 3.2 percent of GDP during the current year. Fiscal deficit stood at Rs 5.25 lakh crore in the April to October period, compared to the Rs 5.47 lakh crore target for the current financial year, as per the data released by the Controller of General Accounts. The deficit increased from September, when it was at 91.3 percent of the target at Rs 4.99 lakh crore.

Speaking at the lecture themed ‘India's Roadmap for World Class Infrastructure', Jaitley said India needs funding worth Rs 50 lakh crore in the infrastructure sector over the next five years.

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