Be inclusive for higher growth: FM

Written by Agencies | New Delhi, March 31: | Updated: Mar 31 2008, 17:27pm hrs
Amid apprehensions of moderation in growth next fiscal, Finance Minister P Chidambaram on Monday said India's economy can easily expand between 10-11 per cent if half of the population, left out from the growth process, is brought into the mainstream of economic activities.

"Please remember India's economy is driven by one half of the population. The other half is mute witness to what is happening in India. If other half also becomes part of the driving forces of growth, India's economy will grow not by 8-9 per cent, it will easily grow between 10-11 per cent," Chidambaram said at a Delhi-based bank's function.

As many people as possible should be brought into the mainstream of economic activity, the Finance Minister said at the Oriental Bank of Commerce (OBC) function.

"What is more important is to give them advantages of vibrant banking system," Chidambaram said. Indian economy's average growth rate is 8.8 per cent in the first four years of the UPA rule, based on the advance estimates of CSO for 2007-08.

However, soaring inflation in recent times may require that some of this growth is moderated.

The Finance Minister himself had said recently after inflation spiralled to over 13-month high of 6.68 per cent, "The Government is determined to take all steps -- fiscal, monetary and supply side -- to moderate inflation. If that means, we have to live with slightly lesser growth, so be it." At the function to launch technology-based initiatives of OBC, the Finance Minister said it is a misconception that Indian masses would not accept new technologies.

"I think we underestimate the people of India. The people of India, take to technology very easily. Just imagine how mobile telephones have spread throughout India. I do not think that banks should worry about whether the people of India will accept the new technologies," Chidambaram said.

He asked the Delhi-based bank to be aggressive in its approach and to expand financial inclusion in the country. "You take your hand-held technologies machines to villages, you will find that the villagers will learn to operate those machines sooner than some of your staffer," he said.