<p>Conceding that intrerest rates were on the higher side and that the Reserve Bank of India (RBI) has had to raise interest rates frequently to tame galloping inflation, Kamath said, he was quite bullish on the Indian economy, which, according to him, in real terms, was actually logging around 10-11 per cent plus growth. <br /><br />Observing that India as a country was growing well over 10 per cent growth, if one moved beyond actual statistical numbers and took into account uncounted and unaccounted growth in the system, which were logging around 1-1.5 per cent, Kamath said the fruits of this stable growth will be felt in the long term when all enablers are in place. <br /><br />Addressing, and answering queries, at the Bangalore Press Club, Kamath said despite the galloping growth India’s per capita income, however, was lagging behind China’s by nearly 10 years. <br /><br />Pointing out that high interest rates regime would not starve corporate sector of funds to pursue their growth plans, Kamath was of the view that the manufacturing sector were largely self sufficient and majority of the corporates were cash flush and could fund through internal accruals alone.<br /><br />However, infrastructure sector and vast populace of growing consumers including MSMEs could be impacted to a certain extent, he noted, while adding that there are, however, no roadblocks which will derail growth despite the challenges faced by the infrastructure sector.<br /><br />On whether this would hit credit off take, he said, if the country’s GDP was around 10-12 per cent then growth in credit will have to be 20-24 per cent (double the GDP growth) and this will happen, discounting fears that there could be a slowing down in manufacturing and growth. He said he was betting high on India’s primary domestic robustness and resilience to absorb any impact, if any. <br /><br />He further said, with 10-12 per cent growth “we can manage inflation”, however, any further prop to push it to faster pace would make things bit difficult. Discounting lobbying as a weapon to change the country’s stance by corporates, Kamath said, lobbying is not the best solution. If consumers find products to be providing value for money, they are bound to buy them. <br /><br /></p>
<p>Conceding that intrerest rates were on the higher side and that the Reserve Bank of India (RBI) has had to raise interest rates frequently to tame galloping inflation, Kamath said, he was quite bullish on the Indian economy, which, according to him, in real terms, was actually logging around 10-11 per cent plus growth. <br /><br />Observing that India as a country was growing well over 10 per cent growth, if one moved beyond actual statistical numbers and took into account uncounted and unaccounted growth in the system, which were logging around 1-1.5 per cent, Kamath said the fruits of this stable growth will be felt in the long term when all enablers are in place. <br /><br />Addressing, and answering queries, at the Bangalore Press Club, Kamath said despite the galloping growth India’s per capita income, however, was lagging behind China’s by nearly 10 years. <br /><br />Pointing out that high interest rates regime would not starve corporate sector of funds to pursue their growth plans, Kamath was of the view that the manufacturing sector were largely self sufficient and majority of the corporates were cash flush and could fund through internal accruals alone.<br /><br />However, infrastructure sector and vast populace of growing consumers including MSMEs could be impacted to a certain extent, he noted, while adding that there are, however, no roadblocks which will derail growth despite the challenges faced by the infrastructure sector.<br /><br />On whether this would hit credit off take, he said, if the country’s GDP was around 10-12 per cent then growth in credit will have to be 20-24 per cent (double the GDP growth) and this will happen, discounting fears that there could be a slowing down in manufacturing and growth. He said he was betting high on India’s primary domestic robustness and resilience to absorb any impact, if any. <br /><br />He further said, with 10-12 per cent growth “we can manage inflation”, however, any further prop to push it to faster pace would make things bit difficult. Discounting lobbying as a weapon to change the country’s stance by corporates, Kamath said, lobbying is not the best solution. If consumers find products to be providing value for money, they are bound to buy them. <br /><br /></p>
