India’s economy has the potential to achieve a growth rate of more than 7-8% in view of the policy changes, accompanied by a supportive global environment, Finance Minister Arun Jaitley said on Tuesday. Addressing the India-Korea Business Summit in Delhi, he observed that over the next 10-20 years India will continue to remain one of the fastest growing economies in the world.
India has demonstrated in the last few years that it has, even in a global environment of adversity, a potential to self correct itself, to continue to take difficult decisions if necessary and maintain a high growth trajectory, Jaitley said.
He said the country has been able to blend its economic decisions along with political acceptability to the extent that there is now a huge support, almost bordering on impatience, where people want India to reform and grow much faster.
The Finance minister said that most people in India believe that a 7-8 per cent growth rate is an absolute normal for the country but the real potential of India is to beat that. Therefore with policy changes accompanied by a supportive global environment, India perhaps has the potential to achieve a little more than that, said the Minister.
He said the Indian economy in the last few years has become very open, it is integrated globally, it invites investments in most sectors and has made its procedures for investment extremely simple.
Government’s decision-making has made doing business in India much easier, he said. It’s a rule based decision making where governmental discretions based on individual cases have been virtually eliminated, Jaitley said on the country’s regime.
The government has been able to unify taxes and bring about a relatively simpler tax structure and for international investors, indirect tax structures have become extremely investor friendly, he said.
In an apparent reference to retrospective taxation, Jaitley said, “Whatever misgivings we had about our direct tax structures in the past including some erroneous decisions which governments have taken, we have completely eliminated those fears and added more predictability and stability as far as taxation is concerned”.
The manufacturing sector is an area where India still has to achieve its best and therefore we believe that in the next decade or two, this is a sector which is going to expand very substantially and most policies therefore are now conducive to domestic manufacturing, said the minister.
He said there is a lot of potential for companies wanting to invest in infrastructure in India.
(With inputs from PTI)