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Will return to 8% growth in 2 years- India FM
April 18, 2013, 9:50 am

[Getty Images]

Mr Chidambaram said ratings agencies outlook on India is not justified [Getty Images]

The Indian finance minister has asserted that India will return to eight per cent growth in two years.

“India is poised for a potential growth rate of eight per cent and the country has not fixed the limit to foreign investments,” Palaniappan Chidambaram said.

The Indian finance minister was addressing the international media in New York.

The minister also said that the ratings agencies perception of India was not justified at all.

“We were never in any danger [of a rating downgrade] and we feel the negative outlook is perhaps not justified at all. I believe that they downgraded China from AA plus to A plus.”

Taking a dig at nations faring much worse economically, he said, “If they are looking at candidates for downgrading, I can suggest a few.”

The government was reviewing sectoral FDI caps, the finance minister revealed.

“We as a country can easily absorb $50 billion investments a year or more. In the hierarchy of foreign inflows FDI ranks first followed by FII and external commercial borrowings.

“FDI is important to India too as in any other country,” he said.

Mr Chidambaram, who met investors in Canada and the US this week, said Indian downturn was a temporary phenomenon.

“I agree that it’s a legitimate question but we have an answer.”

He also reminded those present that “Between 2004 and 2012 we had a growth rate of eight per cent for six years and four years witnessed a growth rate of nine per cent.”

In Washington, Mr Chidambaram is to meet with the new US Treasury secretary Jacob Lew.

With inputs from Agencies

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