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PM wonders if 9pct growth feasible over next 5 years

Prime Minister Dr Manmohan Singh has questioned whether Indian economy will meet an average growth target of 9% annually over the next 5 years, given economic volatility around the globe.

In a speech discussing preparations for India's next 5 year economic plan, which runs from 2012, Dr Singh said that long term economic prospects remained good.

He added that "The approach paper proposes a growth target of 9% per year. It is relevant to ask whether this is feasible since the economy is currently slowing down. The current slowdown is a matter of concern. But it should seem a short term phenomenon, reflecting highly unsettled conditions in the world economy."

Dr Singh said that all major economies were reducing their growth expectations given the debt problems in Europe and the United States. Dr Singh, who in the 1990s ushered in market reforms credited with unleashing India's economic potential, added the country had not done enough to bring the benefits of growth to the poor.

India has been forced to pare growth forecasts this year as high inflation and interest rates hit industry, adding to chill winds from the euro zone and the United States. The government now expects growth of close to 8% this fiscal year. The weakening of India’s economy comes as regional rival China reported last week quarterly growth slowing to 9.1%, its weakest pace in over two years, hit by monetary tightening to curb inflation and global headwinds.