Addressing the members of the Madras Chamber of Commerce and Industry (MCCI) on the occasion of its chamber day, he said that bottlenecks that is being created by these segments of infrastructure would dampen growth prospects and in the next few years could pull the growth rates down to 4 per cent. He also said that the current estimates of a 7 per cent growth in the current fiscal was optimistic and predicted a growth of close to 6 per cent.

Reduction of fiscal deficit, closure of loss-making public sector enterprises and domestic tax reforms are some of the issues that require the immediate attention of the next government. Chelliah said that both state and central fiscal deficit should be brought down to five per cent but doubted whether it would beattempted. High fiscal deficit means the government borrowings in the market would crowd out the industry's requirements thereby pushing up the interest rates.

He also called upon the government to have detailed discussion with the industry before proposals are made at the ministerial level meeting of WTO. Before getting along with disinvestment, the government can save close to Rs 10,000 crore if it closes down all loss-making public sector units. He also suggested merger of loss-making branches to make them viable and then seek public funds through an equity issue rather than recapitalising the banks.

He also came down heavily on the Planning Commission by saying that its plans are unrealistic and needs reforming. Rather than sitting with the state governments to fix the quantum of Plan expenditure, they should look at long-term objectives such as improvements in transport sector, energy sector and the balance of payment situation etc. It should also try and address the regional disparities which onlyseems to grow, Chelliah adde.

Sridhar Venkiteswaran, Business Consulting Group in a presentation said that the economy would end the fiscal with a growth of 5.8 per cent to six per cent as against the target of seven per cent. Decline in agricultural sector growth would be the main cause, he said for this though the manufacturing and services sector would do well this year over previous year.

G K Raman, president, MMCI said that the 27 per cent increase in government expenditure for the period April-July was a worrying factor and hoped that the government would take corrective steps to fuel the economic growth.