8% annual average growth during 11th Plan

Seeking to puncture claims that India’s economy has slipped to a new low, the government Thursday said the country has logged an average annual economic growth of  8 per cent during the 11th five-year-plan although the target was to achieve 9 per cent.

The 11th Five Year Plan was in force from 2007 to 2012.

"The shortfall in achievement of (various growth targets) can be attributed both to internal and external factors viz. global slowdown, fluctuations in international prices, strong inflationary pressures and negative growth in agriculture due to drought like situation," Planning Minister Rajeev Shukla said in a written reply to the Rajya Sabha.
The agriculture sector grew in line with expectations while the industry slipped to a little over 7 per cent from the projected upto 11 per cent. The services sector growth was a little over a percentage point lower than the target of 11 per cent, the minister said adding the government was taking several steps to address the slowdown.

The services sector grew at an average rate of 9.7 per cent per annum compared to the targeted 9-11 per cent in the five year period, he said in the reply.

The government in the past couple of years has taken steps like setting up of Cabinet Committee on Investment to fasttrack large infrastructure projects, strengthening of financial and banking sector and also steps to increase infrastructure financing.

In its advance estimates, the Central Statistics Office has pegged economic growth in the current fiscal at 4.9 per cent which would be slightly higher than 4.5 per cent achieved in 2011-12. Finance Minister P Chidambaram, however, has said that he expects economic growth to be 5 per cent in 2013-14 when the final figure arrives two years from now.

The Approach to the 12th Five Year Plan (2012-17) had envisaged 9 per cent annual average economic growth rate which was later fixed at 8 per cent by the National Development Council (NDC) in December 2012 while approving the five year policy.
These growth targets for the 12th Plan would be reassessed in the mid-term appraisal of the five year policy in 2014-15.

In the backdrop of lower economic growth rates of 4.5 per cent in first year of 12th Plan (2012-13) and 4.9 per cent in second year (2013-14), the annual average economic growth rate target for the entire five year policy could be revised downwards, it is felt.