Mumbai:
India is aiming to achieve 10-per cent annual GDP growth
by the year 2011-12, but the country needed over $300
billion to upgrade its infrastructure over the next five
years, prime minister Manmohan Singh told a meeting of
the Planning Commission.
The
country needed double-digit growth in manufacturing and
services sectors in the next five years, and had to double
farm output, if it was to meet the target, he pointed
out.
The
Indian economy has grown at an average eight per cent
in the past three years, and a 10 per cent annual GDP
growth is difficult to achieve unless the country improves
its infrastructure.
"Infrastructure
development is a major constraint on our industrial growth,"
and "we would need more than Rs1,400,000 crore ($308
billion) by 2012," the prime minister, who is also
the chairman of the planning commission, said.
He
said some of the investment in infrastructure would have
to come from the private sector.
But private players have been slow to invest in power
projects and roads due to the absence of proper user charges.
Analysts
say India will need to raise its household savings and
investment rates as a percentage of GDP so it can spend
more and achieve a higher growth trajectory.
The
plan panel, meanwhile, said in an approach paper prepared
in June that investment as a percentage of GDP should
go up to 33.6 per cent, while the savings rate must hit
31 per cent - the rest coming from foreign investment
- to target an 8.5 per cent annual growth rate.
The
commission had pegged annual growth target for the farm
sector
at 3.9 per cent, at 9.9 per cent for industry, and at
9.4 per cent for the services sector. Exports need to
grow at 16 per cent and imports by 12.1 per cent to rein
in the current account deficit at 2.6 per cent of GDP
during the next five-year period, the paper pointed out.
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