Finance Minister Arun Jaitley has said that Indian economy needs to grow at 9-10 per cent and sustain that growth rate over the next decade and beyond to provide better infrastructure and bring down poverty rates.
Jaitley, who is in New York on a private visit, said India should aim to achieve 8 per cent growth rate this year and grow it to 9-10 per cent over the next 10 years and more.
“I can sound very optimistic but I will be realistic,” he said in response to a question about his vision for India over the next 5-10 years during a session at Columbia University’s School of International and Public Affairs on Monday.
Citing the example of China, Jaitley said the Asian country grew by about 9 per cent on an average for over three decades and reached where it is today.
“If we are able to reach 8 per cent this year, grow it further and aim for 9-10 per cent growth rate and then continue at that pace for many more years than 10 years, that is what India requires,” he said before a packed house at a session on ‘Indian Economy: The Way Forward’.
The event was also attended by former Columbia professor Arvind Panagariya, who has been appointed as Vice Chairman of the newly created NITI Aayog.
Jaitley said India needs resources to push up growth rates but it cannot get those resources unless it grows by 9- 10 per cent. He stressed that a sustained growth rate of close to 10 per cent over the next decade and more is required to create improved infrastructure and bring down poverty rates.
“I think if we continue at that rate of growth over the next 10 years we would have substantially created a better infrastructure and brought down poverty rates at a faster pace,” he said, adding that “I would like to see India grow by that rate over the next 10 years, I would like to see a very large part of that resource plus all that investment.”
He said there is a need to correct one of the political debates in India of “are you pro-industry (or) are you pro-poor.
“As though there is a conflict between the two. I think that is the mistake the previous government made. In order to just concentrate on distribution of resources, they forgot the steps which were required to push up the growth rates.”
He also underscored that India will need to get investment from outside in order to fuel economic growth.
“I have no doubt about the fact that the investment available within the country is very modest. Even our banks’ ability to finance that is modest therefore we need it from wherever it is available and a lot of those resources have to go into infrastructure, a lot of additional enrichment of the government has to go into further strengthening our poverty alleviation and elimination schemes,” he said.
He added that all these steps along with sustained growth rates of 9-10 per cent would help create better infrastructure and bring more people out of poverty.