“We hope the economy will grow by nearly 9 per cent in the next financial year (2011-12) while continuing the ongoing fiscal consolidation,” he said, replying to a day-long discussion on the Finance Bill, 2011 in the Upper House.
Assuring that consistent focus on fiscal consolidation will not hamper the growth momentum, Mukherjee said that along with sustaining ongoing growth momentum, the other priority of the government would be to keep inflation under control.
Later, the Upper House by voice vote approved the Finance Bill, 2011 which contains tax proposals—both in the Direct and Indirect Tax front. The Finance Bill has earlier been approved by the Lok Sabha.
With the Rajya Sabha returning the Finance Bill as approved by the Lok Sabha the Budget got the final approval of Parliament.While dwelling on wide range of macro economic issues Mukherjee said his robust optimism for higher growth in the next fiscal was based on “reasonable” expectation of higher mobilisation of funds for investment.
“Major chunk of funds for investment will come from our domestic savings, which is 36 to 37 per cent of the GDP. Though funds inflow through the Foreign Direct Investment (FDI) is not up to expectation, some percentage of funds will be met through other external resources,” he said.
The other factor that is giving confidence for higher growth rate is due to improvement in the growth rate of agro sector, which few years back was at a low level of less than 2 per cent, Mukherjee said. Agro sector is likely to grow by 5.4 per cent, he said.