Feb 16, 2008

Economy News- 15th Feb 2008

· PM confident of sustaining 9% economic growth

· Inflation down 4.07% in the week ended 2 February 2008

· Government to offer package to address credit needs of farmers: PM


· PM confident of sustaining 9% economic growth

On 15 February 2008, Prime Minister Manmohan Singh while addresing the annual meeting of the Federation of Indian Chambers of Commerce and Industry (Ficci) in New Delhi, expressed confidence on sustaining a 9% annual economic growth despite a possible global slowdown.

The minister also cautioned India must be aware that it cannot be completely insulated from chilly global winds that may blow in its direction.

He further said keeping the lid on inflation rate was a priority for his government, but controlling the price-line did not mean growth would be sacrificed.

Amid fears that a hike in petrol and diesel prices might fuel inflation, he said the government has taken an important policy stand to keep inflation under check and ensure that growth is more inclusive. The minister termed inflation as iniquitous tax explaining that it hurts the poor more than the rich. Therefore, it is essential to ensure that the poor are not adversely affected by high inflation, particularly that of basic items of consumption.


· Inflation down 4.07% in the week ended 2 February 2008

Annual inflation, based on the wholesale price index, moved down 4.07% in the week ended 2 February 2008 compared with 4.11% in the week ended 26 January 2008. Inflation was 6.58% in the corresponding week a year ago.

The market estimate stood at 4.16%.

Prices of fruits and vegetables decreased 3% and those of arhar, masur and condiments and spicesn reduced 1% each. Prices of jet fuel also eased in the week.

Inflation figure for the week ended 8 December 2008 was revised upwards to 3.845 as against 3.65% reported earlier.


· Goverment to offer package to address credit needs of farmers:PM

On 15 February 2008, Prime Minister Manmohan Singh while addresing the annual general meeting of Federation of Indian Chambers of Commerce and Industry (Ficci) in New Delhi, said the government will soon come out with a package to address the indebtedness of farmers.

The minister pointed out that the share of agriculture in the GDP has been declining. He added that the importance of this sector for India's economy cannot be minimised this sector as it supports a significant portion of the country's population and also acts as a social safety net.

The package would look into the credit needs of farmers. The minister explained the goverment could not have a situation where 80% of the agri sector is outside the formal financial system and suffers from excessive indebtedness.

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