Given the high level of food, oil and other commodity prices in international markets, the risks to inflation remain, he said. “There are, also downside risks to growth arising from slowdown and possible recession in the global economy”, he added.

While the survey cautioned that sustaining high growth would be a daunting task, Mr Chidambaram, however, asserted “given the solid foundation of domestic investment and saving, we are confident of meeting the Eleventh Plan (2007-08 to 2011-12) target of 9 per cent average growth.”

“We will be able to mobilise resources for meeting the growth target of 9 per cent, as set for Eleventh Five Year Plan. Macro-economic fundamentals continue to inspire confidence and the investment climate is full of optimism”, Mr Chidambaram said. “Optimism but with caution is the watchword” for outlook for 2008-09, he said adding “it will be my priority to continue to provide a conducive investment climate and manage the macro economy to facilitate non-inflationary growth,” he added. 

At the same time, Mr Chidambaram said India needed to respond to evolving situation in the global economy to ensure that growth story was not affected while emphasising on the need for capitalising on opportunity arising from favourable conditions.

Conducive climate

“I am optimistic about growth and containment of inflation in the coming year (2008-09),” he said, adding his priority was to provide a conducive investment climate and manage macro economy to facilitate non- inflationary growth.

After remaining at below 4 per cent for six months, the inflation rate has touched 4.35 per cent for the week ended February 9. With hike in petrol and diesel prices recently, it is expected to go up further. He said high GDP growth has benefited the common man as well.