Committed to 9-10 per cent economic growth, says PM

"We are committed to a growth rate of 9 to 10 per cent per annum. Our savings rate is about 34 to 35 per cent of our GDP...with an investment rate of 36 to 37 per cent (and) capital output ratio of 4:1, we can manage to have a growth rate of 9 per cent," he said while interacting with a group of editors here.

The Prime Minister, however, said raising economic growth rate to double digits would require strong commitment to improving infrastructure and upgrading education and healthcare facilities.

His assurance comes in the wake of the Reserve Bank lowering the economic growth projection to 8 per cent for the current fiscal as against 8.5 per cent achieved in 2010-11.

Referring to the the economic agenda for the next eight to nine months, Singh said, "First, it is to sustain momentum of growth that we have attained. Second is to ensure that infrastructure does well, procurement system must be made more transparent."

He also sought cooperation from the Opposition in passing the reform-oriented legislations like Insurance Bill that seeks to raise foreign direct investment (FDI) limit to 49 per cent from 26 per cent now.

"We helped BJP to pass first Insurance Bill...we want to raise FDI to 49 per cent. We hope, we can still persuade the Opposition to help in this", he said.

Expressing concern on the international front, Singh said, "I think the situation is not that positive. The international global recovery is fragile. Even the US growth rate is faltering.
"In Europe, it is the sovereign debt crisis, the problem of the Greek crisis, and whether the Euro-zone will survive or not. If it will not survive, it will be a major institutional collapse," he said.

He further said that what was happening in the Middle- East was of direct concern to India. Apart from the fact that six million Indians work there, "nearly 70 per cent of our oil supplies come from the countries of the Gulf and North Africa. What turn these events will take nobody knows.

"So, (we) have to swim against this adverse tide and therefore India requires all the energy and all the cohesiveness of our polity to swim against these tides and come out victorious," he said.

Citing the example of handling 2008 financial crisis, Singh said that India managed to retain a growth rate of 7 per cent followed by 8-8.5 per cent. "We must have the vision, the ability and the determination to prosper even when the world environment is hostile," he added.

On the domestic front, he said, the country should move ahead with important legislation like the Goods and Services Tax and remove barriers to inter-state commerce.

On the contentious issue of allowing foreign investment in multi-brand retail, the Prime Minister said, "There is a big debate on this. Small traders have a fear but there is the other side also."

The industry ministry had earlier come out with a discussion paper making a case for opening multi-brand retail sector to foreign investment. The government has already allowed 100 per cent FDI in wholesale business.