Manmohan Singh says growth solid despite global slowdown

Prime Minister Manmohan Singh delivers a speech during a news conference at the end of the EU-India summit in Marseille September 29, 2008. The Indian economy will grow at a rate of 7.5 to 8 percent this year despite being dented by the global slowdown, Singh said on Tuesday.

PARIS (Reuters) - The Indian economy will grow at a rate of 7.5 to 8 percent this year despite being dented by the global slowdown, Prime Minister Manmohan Singh said on Tuesday.

India is aiming to sustain high growth rates but also needs to cool double-digit inflation before the government heads into a general election in 2009.

Singh acknowledged that slowing growth elsewhere, exacerbated by the financial markets crisis, had taken its toll on India's economy but added that the outlook was still strong.

"Despite the uncertainties of the global economic and financial outlook, the prospects of Indian growth seem very good," Singh told a conference hosted by French business lobby group MEDEF.

"Our economy has grown at an average rate of 9 percent in the past four years. It is expected to slow down in the current financial year, reflecting the slowdown in the global economy. Even so, it will grow between 7.5 to 8 percent," he added.

India's gross domestic product grew by 7.9 percent during the April-June period from a year earlier, and the prime minister's economic advisory council expects it to average 7.7 percent for the full fiscal year.

"More importantly, our medium-term prospects remain strong, based on good fundamentals. We have weathered the current credit crisis facing the global banking and financial sectors," Singh added.