Anand Sharma forecasts 9 pct-plus GDP growth

SINGAPORE Fri Jul 9, 2010 6:27pm IST

An employee works inside a steel factory in Hyderabad June 3, 2010. REUTERS/Krishnendu Halder/Files

An employee works inside a steel factory in Hyderabad June 3, 2010.

Credit: Reuters/Krishnendu Halder/Files

Related Topics

SINGAPORE (Reuters) - India's gross domestic product growth is expected to return to "9 percent plus" this year, Trade Minister Anand Sharma said on Friday, led by strong corporate performance and rising savings levels.

Sharma also said he expected inflation, which is fuelled by food demand, to be brought under control.

"We are seeing strong economic growth. We are going back this year to plus 9 percent GDP growth," Sharma told reporters in Singapore at the end of a two-day trip aimed at drumming up investment in the infrastructure sector.

The Indian finance ministry has forecast 8.5 percent growth for Asia's third-largest economy in the current year, following a 7.4 expansion in the previous year. The IMF has forecast 8.8 percent growth.

Strong corporate sector performance and high levels of saving and investment have led to higher growth, Indian officials said last month. India is saving and investing about 34 percent of GDP, compared with around 30 percent prior to 2003.

Inflation, running at over 10 percent, has been a mounting concern, however, but Sharma said he expected it to be brought under control this year.

"Inflation has been there, fuelled by food articles demand and supply issues last year. We are assured this will improve this year," he said.

The food price index rose 12.63 percent in the year to June 26, according to data released on Thursday, easing from the previous week's annual rise of 12.92 percent.

Wholesale prices, the most closely watched inflation gauge in India, rose 10.16 percent in May from a year earlier and a senior government official said it could hit 11 percent in June.

Sharma said the government aimed to boost the share of manufacturing in GDP to 25 percent from 16 percent now and turn the country into a manufacturing powerhouse.

He said India's infrastructure sector offered a huge opportunity for construction companies. "The sector is set to absorb $1.7 trillion in the coming 10 years, that's great opportunity." (Editing by Muralikumar Anantharaman)

FILED UNDER:

Reuters Showcase

India Crush UAE

India Crush UAE

India cruise to easy win over UAE in Perth.  Read 

Budget 2015

Budget 2015

Full coverage of 2015/16 budget.  Full Coverage 

Sahara Saga

Sahara Saga

Some staff say Sahara has not paid salaries for months   Full Article 

Movie Review

Movie Review

"Dum Laga Ke Haisha" is rooted in reality, writes Shilpa Jamkhandikar.  Full Article | Related Story 

Nimoy Dies

Nimoy Dies

Leonard Nimoy, Star Trek's 'Mr. Spock,' dies at 83.  Full Article 

Gown Returned

Gown Returned

Lupita Nyong'o's $150,000 Oscar gown returned by thief via TMZ.  Full Article 

World Cup 2015

World Cup 2015

Full coverage of cricket world cup in Australia and New Zealand.  Full Coverage 

Reuters India Mobile

Reuters India Mobile

Get the latest news on the go. Visit Reuters India on your mobile device.  Full Coverage