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NEW DELHI: Finance minister Pranab Mukherjee sought to calm the jittery stock markets saying that India's macroeconomic fundamentals are strong and the country will clock 8.5% growth in the current financial year.
He blamed the recent volatility in the stock markets to selling by foreign institutional investors. "While the stock market has its own mind and it takes cues from developments all around, I want to take this opportunity to reiterate the strong fundamentals of the Indian economy," Mukherjee said in an unscheduled briefing.
The benchmark index Sensex of the Bombay Stock Exchange has lost 5.90% in the past five trading sessions with investors pressing hectic sales following concerns over the Egypt crisis, high inflation and grwoth concerns. The benchmark BSE sensex markets recovered on Wednesday, gaining 68 points to close at 18,090.62 points.
Mukherjee asserted that India growth story was on track and projections for the current financial year would be achieved. "Broad-based GDP growth at 8.9 % in the in the first half of current fiscal has taken the economy back to the pre-crisis growth momentum," he said.
Quick estimates of national income, released a few days ago by the Central Statistical Organisation (CSO), suggests that the stimulus driven recovery in 2009-10 was stronger than earlier believed. The central statistical office revised the growth for the year to 8% from 7.4%.
Rebound in both savings and investment growth augurs well for sustaining high growth of the economy in the medium to long term, Mukherjee said. He said though there had been a fluctuation in prices with food inflation rising to 18.32% but such periodic flutuations were not unusal in a large economy such as India.
However, he cautioned in the remaining three months "there may be some fluctuations". Robust revenues and better realisation from sale of 3G spectrum will help the government better fiscal deficit target. "The year would end with a better than projected fiscal balance and a more moderate inflation," he said.
Mukherjee said the current fiscal situation has been aided by the more than anticipated realisation in non-tax revenues, it has also afforded the opportunity to increase plan and other developmental spending in the course of the year.
'We'll take care of fuel rise'
Finance minister Pranab Mukherjee said the government is keeping a close watch on the spike in international crude oil prices following the turmoil in Middle East and promised to "take care" of its impact on domestic retail fuel prices.
He blamed the recent volatility in the stock markets to selling by foreign institutional investors. "While the stock market has its own mind and it takes cues from developments all around, I want to take this opportunity to reiterate the strong fundamentals of the Indian economy," Mukherjee said in an unscheduled briefing.
The benchmark index Sensex of the Bombay Stock Exchange has lost 5.90% in the past five trading sessions with investors pressing hectic sales following concerns over the Egypt crisis, high inflation and grwoth concerns. The benchmark BSE sensex markets recovered on Wednesday, gaining 68 points to close at 18,090.62 points.
Mukherjee asserted that India growth story was on track and projections for the current financial year would be achieved. "Broad-based GDP growth at 8.9 % in the in the first half of current fiscal has taken the economy back to the pre-crisis growth momentum," he said.
Quick estimates of national income, released a few days ago by the Central Statistical Organisation (CSO), suggests that the stimulus driven recovery in 2009-10 was stronger than earlier believed. The central statistical office revised the growth for the year to 8% from 7.4%.
Rebound in both savings and investment growth augurs well for sustaining high growth of the economy in the medium to long term, Mukherjee said. He said though there had been a fluctuation in prices with food inflation rising to 18.32% but such periodic flutuations were not unusal in a large economy such as India.
However, he cautioned in the remaining three months "there may be some fluctuations". Robust revenues and better realisation from sale of 3G spectrum will help the government better fiscal deficit target. "The year would end with a better than projected fiscal balance and a more moderate inflation," he said.
Mukherjee said the current fiscal situation has been aided by the more than anticipated realisation in non-tax revenues, it has also afforded the opportunity to increase plan and other developmental spending in the course of the year.
'We'll take care of fuel rise'
Finance minister Pranab Mukherjee said the government is keeping a close watch on the spike in international crude oil prices following the turmoil in Middle East and promised to "take care" of its impact on domestic retail fuel prices.
