A day after Prime Minister Narendra Modi vowed to take GDP growth to double digits, Finance Minister Piyush Goyal on Monday said that it is possible but for that people will have to do their business honestly. "I see double digit growth happening by the fourth quarter of this year. There is one caveat to this...when this country decides to do business honestly, we will have 10 per cent GDP growth," Goyal said.
Piyush Goyal believes that there is a demand uptick in the country and growth will be driven by a society that has become very aspirational. The Union Minister's statement came a day after Prime Minister Modi while speaking at the Niti Aayog's fourth Governing Council meet said that the economy has grown at a healthy rate of 7.7 per cent but the challenge now is to take this growth rate to double digits.
In the fourth quarter of FY 2017-18, India's GDP growth rate was 7.7 per cent. The overall economic growth of the last financial year stood at 6.7 per cent. In FY 2016-17, the Indian economy reported GDP growth of 7.1 per cent.
Almost, all financial institutions and rating agencies feel that India has the potential and needs to grow in double-digit to create jobs for its people, but so far not a single agency has predicted the economic growth of over 8 per cent in foreseeable future.
The Reserve Bank of India expects India to grow at 7.4 per cent in FY 2018-19. The Economic Survey tabled in Parliament on January 29, had estimated that India would re-establish itself as the world's fastest growing major economy with GDP expanding by 7-7.5 per cent in 2018-19.
The International Monetary Fund, too, has predicted India's economic growth at 7.4 per cent in FY 2018-19.
The World Bank has also predicted India's GDP growth at 7.3 per cent in FY2018-19. In a report released recently, it said: "Growth in India is projected to accelerate to 7.3 per cent in FY2018-19 and 7.5 per cent on an average in 2019-20."
In March, investment bank Goldman Sachs downgraded India's economic growth from 8 per cent to 7.6 per cent for financial year 2018-19. It, however, retained growth prediction for FY 2019-20 at 8.3 per cent.
Earlier in January, former Niti Aayog vice-chairman Arvind Panagariya had said India has the potential to achieve10 per cent growth rate, but it needs major reforms in the areas of labour laws and land acquisition.
He said: "For India to achieve double-digit growth, the country needs major reforms in labour and land acquisition laws. It also needs significant privatisation and a major reform of civil service, which is quite not sufficient to handle the large economy that India is now."