The country can swing back to a high-growth path with some right fiscal measures that are being taken, the Home Minister, Mr P. Chidambaram, said here on Tuesday.
The Government was putting in place measures to boost the economy by addressing fiscal and current account deficits, he said.
The Euro Zone, a key export market, he hoped, would recover quickly, too.
He recalled the 2007-08 scene and said: “I’m sure we will get back to the high growth path. There were problems like price rise and only a high growth rate could overcome them. I think the Prime Minister cum Finance Minister is contemplating a number of measures to tighten revenue collection and control wasteful expenditure. Already we have imposed an across-the-board cut on non-Plan expenditure.”
Another way out was to import less and produce more — of iron ore, gas and coal, for example.
Exchange rate
“The current account deficit will come down over a period of time. We can tackle these four issues (savings, investments, the two deficits) and you will see that we get back to high growth path. The rupee exchange rate would stabilise once confidence improves,” he said. The Minister, who heads the seven-person Group of Ministers on media, was speaking at a news conference along with the Law Minister, Mr Salman Khurshid.
Mr Chidambaram observed that China was investing massively overseas; recently it had revealed a $50-billion investment plan by Chinese companies in four Latin American countries.
“We [too] should acquire iron ore and coal mines and gas fields abroad,” so that domestic companies reached new markets. As Indians were big savers, “We save in gold. We can persuade our families to save in financial instruments,” he said.