Economy likely to sustain growth at 10%

Written by Agencies | Mumbai, October 22: | Updated: Oct 22 2007, 20:43pm hrs
The Indian economy has sustained its growth and this is expected to continue in the medium term, despite concerns over higher inflation in future and high fund inflows, a top banking industry official said.

"I think a growth of around 10 per cent will be sustained in the next 10-15 years. We have come through various challenges like inflation and 'overheating'. But growth has been sustained," ICICI Bank's Managing Director and CEO K V Kamath told reporters on the sidelines of a CII-organised seminar.

However, the surge in rupee value and excess inflows were challenges to the economy, attracting multiple tools from the regulators. "The regulation on Participatory Notes (P-Notes) is one among the many tools from the regulators to check inflows, which is a concern to the economy," he said.

Inflation may rise again as global crude oil prices continue to soar touching an all-time high of 90 dollars last week, besides, rising food prices in the domestic market.

On the issue of interest rates, Kamath said the bank would wait till the ensuing mid-term policy, due on October 30, before taking any decision.

"We will wait for the monetary policy before taking any decision," the bank's CMD said, adding he was not for "any speculation on a hike in policy rates from the banking regulator including in the CRR."

Asked about recent allegations against the bank's recovery agents of using strong-arm methods, Kamath said banks will have to be responsible in the matter.