India can sustain 9-10 pct GDP growth - PM

By Unni Krishnan

NEW DELHI (Reuters) - Conditions were favourable for India to achieve and sustain economic growth of 9-10 percent, although it required an increase in savings and investment rates, Prime Minister Manmohan Singh said on Tuesday.

India has grown at an average of 8.6 percent over the past four fiscal years, and is poised to grow at a similar pace in the 2007/08 fiscal year which ends in March.

"It has been a good year for the Indian economy, for our working people and our entrepreneurs. The conditions are today favourable to achieve and sustain 9-10 growth rate," Singh said at a function for India's large expatriate community.

"The ambitious growth rate that we seek to achieve will require determined efforts to raise our savings and investments rates. The bulk of resources for India's development must come from home."

India's savings rate has reached 34 percent of gross domestic product and the investment rate has crossed 35 percent. The government expects these high rates to rise because of India's young population profile.

Singh was speaking at the government's annual "Pravasi Bharatiya Diwas" (Overseas Indians Day), which honours prominent expatriate Indians and also taps the community for investments.

Globally, expatriate Indians have an estimated US$1 trillion in assets, and wealth managers in Singapore, Dubai, Hong Kong and elsewhere have been stepping up efforts to help manage it.