In an apparent bid to soothe the nerves of the jittery stock markets, the Finance Minister, Mr Pranab Mukherjee, today said that the fundamentals of the economy are strong and that economic growth rate of at least 8.5 per cent will be clocked for the current fiscal.
“In the past few days there has been some volatility in the capital markets, led by continued selling pressures from the FIIs. While the stock market has its own mind and it takes cues from developments all around, I wanted to take this opportunity to reiterate the strong fundamentals of the Indian economy,” Mr Mukherjee told reporters outside North Block here on Wednesday.
He expressed confidence that the growth projections for the current fiscal would be met and that the year would end with a better than projected fiscal balance and a more moderate inflation.
Mr Mukherjee pointed out that the Central Statistical Office (CSO) had few days ago revised upwards the GDP growth rate of 2009-10 to 8 per cent from 7.4 per cent estimated earlier. This suggests that the stimulus led recovery in 2009-10 was stronger than earlier believed, he said.
More importantly, both savings and investment growth have shown a strong rebound in 2009-10, he said, adding that this augurs well for sustaining high growth of the economy in the medium to long term.