In view of low inflation and consolidation of GDP growth, India was poised to contribute significantly to the world output, Reserve Bank of India Governor Y V Reddy said on Thursday.
"We had indicated a 6.5 to 7 per cent GDP growth with an upward bias for this financial year. We revised the outside base last year and at this point of time we feel the growth prospect of the GDP can be more compared to what we had estimated and this is good news," Reddy told reporters after a meeting of the Central Board of Directors of the RBI.
Asked if the current growth rate of GDP was likely to continue next year, Reddy said, "This year's growth pegged by various agencies at 7 to 8 per cent is largely due to a turnaround in agriculture, but we should not underestimate the impressive gains which are being observed in the manufacturing industry."
"Though we cannot put an exact number (about growth in GDP), there are indications, both global and domestic, that there will be fairly respectable and strong growth next year also and India would be among the countries which will significantly contribute to the world output," he said.
Reddy ruled out the need of effecting any change in the existing interest regime in the near future.
Reddy said he expected the rate of inflation to come down further.
"We had indicated an inflation rate of 4 to 4.5 per cent and had removed the downward bias. I expected it to come down even further by mid January. But in the present situation, I think it will end up near where we had originally estimated."
"Given the GDP and inflation scenario, which are, by and large, in the same framework which we had originally indicated we don't see any reason to change any of the measures already in operation," Reddy said in answer to a question as to whether RBI intended to effect any changes in its monetary policies, including bank interest.
Asked if the prospects of early general elections would have any impact on the economy, he said, "Some people talk of electoral uncertainty, currency uncertainty between euro, dollar etc. And there are others who talk of fundamental savings-investment imbalances in the world. But I believe that given the condition of domestic economy and financial market there is no need at this stage to review our policies."
