Finance Minister P Chidambaram remarked that the Indian economy is poised for a potential growth rate of 8 per cent and the country has not fixed the limit to foreign investments.
While attracting investors from Canada and the USA, he said the Indian economic downturn is a temporary phenomenon. Between 2004 and 2012, India had a growth rate of 8 per cent for six years and four years witnessed a growth rate of 9 per cent.
Indian economy will return to 6 per cent growth in the current year, he said.
He informed that the government was reviewing sectoral FDI caps as many of them were imposed at different points of time.
Speaking to the international media in the US, the minister said the country can absorb $50 billion foreign investments annually.
He said the government has no timelines or targets in mind to reduce the high current account deficit (CAD) , which stand at around 5 per cent of GDP in 2012-13.
But he expressed hope that the decline in crude oil prices would reduce the CAD.
India as a country can easily absorb $50 billion investments a year or more. In the hierarchy of foreign inflows, FDI ranks first followed by FII and external commercial borrowings. FDI is important to India too as in any other country, he said.
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