India’s economy on much higher, stabler footing: Jaitley
Bengaluru : Amid global uncertainty, Finance Minister Arun Jaitley today said it is important for India to emerge out of the crisis stronger as it is on a much higher and stabler footing than other nations.
“Unpredictability and volatility have become the new global norm. In these circumstances, it is extremely important for India to emerge and emerge out of the crisis even stronger,” he said while addressing the Invest Karnataka 2016 summit here.
Jaitley said that India is “relatively unimpacted” by some of the factors that have caused the global crisis.
“Lower prices of oil and metal commodities substantially suit us. It indirectly impacts us because it shrinks our exports; it makes our markets more volatile, currency more volatile. But compared to the rest of the world, we are still on a much higher and stabler footing,” he said.
The Minister said that while looking down the tunnel over the next two to three years, it is still not clear which way the global situation will be moving.
The Indian economy is expected to grow between 7-7.5 per cent in the current fiscal. Last fiscal, it grew 7.2 per cent.
“The world faces a very difficult and challenging situation… In the global situation, India is being distinctively noticed. It is being noticed for the reason, that even in the midst of global slowdown, India has comparatively stood out,” he said.
He said that while looking back at 2001, 2008 and 2015 global crises, India can take some satisfaction in the fact that the country displayed a considerable amount of resilience during those times.
Since the 2008 crisis, the global economy has not been able to pick up momentum, with some country or the other facing problems.
Stating that nobody could have expected China to grow indefinitely at a double digit growth rate, Jaitley said China’s “slowdown itself doesn’t directly impact us, except for some indirect consequences.
“Under these circumstances when comparable economies are struggling we have an important and powerful opportunity in front of us in order to make sure that our own domestic economic systems are strengthened.”
“In this strengthening we have been able to maintain a macroeconomic situation which is far more favourable than it had been in the past and this is what makes India the fastest growing economy in the world,” the minister added.
Jaitley further said that global investors are looking at India and “it is important for India to respond and respond in one voice”. We can never allow our federalism or our democracy to become an obstacle in the process, he said.
The Finance Minister further said that merely organising investor meets will not get states the required investments.
“States which have a consistent track record of a stable administration, a good governance, clean administration, stable politics, stable policies, easy availability of land, natural resources, easier prospects of doing business… it is those states which will then become the primary destinations as far as the investments are concerned,” he said.
Appreciating Karnataka for innovating with time, Jaitley said it has kept the state at the centre stage of India’s development.
Referring to cooperative federalism, he said governance is a shared responsibility of the Centre and the states, while the ultimate objective of the shared sovereignty is how “we empower people, how we make India grow faster and how we make sure that rates of poverty get depleted very fast”.
“India is a case where the Centre and states have to compete with each other, then cooperate with each other, in order to make sure that the cooperative federalism brings out a model of economic governance in the country,” he said.
Jaitley said there is no other cure for depletion of poverty and its final elimination other than making India grow.
“It is only when India grows faster that we are going to pull out a large number of people out of the poverty levels,” he said.