Business   

5-5.5 p.c. growth in GDP likely — Jalan

By Our Special Correspondent

MUMBAI DEC. 17. The Governor of the Reserve Bank of India, Bimal Jalan, said the Indian foreign exchange market was stable and orderly and the country was confident of achieving 5 to 5.5 per cent growth in the economy.

"India's foreign exchange markets have been broadly stable and orderly and GDP growth is likely to be in the region of 5 to 5.5 per cent despite this year's drought,'' Dr. Jalan said addressing central bank governors of Africa at a meeting organised by the Bank of International Settlements in Basel on Monday. He also said India had nearly tripled its foreign exchange reserves in the past three to four years and had kept the inflation low.

Drawing on the Indian experience, Dr. Jalan said the primary responsibility for crisis prevention had to be that of the country itself. Emerging market countries in particular needed to adopt policies that prevented an external crisis from arising. Unlike in the past, he said, India had been able to prevent external crisis by adopting sound external management policies.

A stable macro-economic environment with low inflation, low current account deficit and reasonable growth was essential to prevent crisis.

Fortunately, Dr. Jalan said, India had been able to contain inflation below 3 per cent, had kept current account deficit below one per cent and had achieved growth above 5 per cent. Dr. Jalan said a policy to build a high level of foreign exchange reserves that took into account not only anticipated current account deficits but also liquidity at risk arising from unanticipated capital movements. He also said there was a need for judicious policy for management of the capital account, in particular, short-term banking capital for financing investments and growth had to be avoided.

Printer friendly page  
Send this article to Friends by E-Mail

Business

News: Front Page | National | Southern States | Other States | International | Opinion | Business | Sport | Miscellaneous |
Advts: Classifieds | Employment | Obituary |

Stories in this Section

• DoD for 26 p.c. equity sale in HPCL to strategic partner
• Efforts on to secure release of Polaris officials
• 5-5.5 p.c. growth in GDP likely — Jalan
• Bank shares in limelight
• Rupee strengthens further
• Russian GIS industry keen to cooperate with Indian cos.
• AICMA for removing 4 p.c. excise duty on bicycles
• Ravi Sharma new Alcatel India MD
• Reforms in investment approvals proposed
• Orchid acquires Mano Pharma
• TAFE plans to launch new variants
• Stock Market Index
• Exchange rates
• Bullion rates
• Hyundai bags energy conservation award
• Sify gets venture funding

Copyright © 2002, The Hindu. Republication or redissemination of the contents of this screen are expressly prohibited without the written consent of The Hindu