“India is now a USD 2 trillion economy. Even if the growth rate has slipped to a decade low of 5 percent, Indian economy continues to grow. It is an important destination for UK to invest,” Mathai said during the inauguration of the new Economic Forum for India (EFIL) at London School of Economics on March 15.

While talking about the sluggish growth rate of India, Mathai said, “We have a sustainable series of proposals for 2012-17 overcome the economic woes. The need of hour is to give stress on structural reforms, impose tighter control over macroeconomic imbalances and meet the fiscal deficit targets. The aim is to achieve 8 percent annual average economic growth during the 12th Five Year Plan (2012-17). We are quite optimistic that the GDP will get back on track by next year.”

India's key inflation rate has dropped to nine-month low of 4.68 percent in February.

“Inflation in India persists and is phenomenal. While other economies are able to manage it in a better way, we are lagging behind. The economic thinkers need to give a deep though on the various aspects leading to inflation in the country,” Mathai said.   

Terming infrastructure sector as the backbone of any economy, the former foreign secretary of India said, “Country’s infrastructure sector is facing a slowdown. More than half of infra projects are biting dust due to regulatory hurdles like delay in approvals and draconian land acquisition laws. It is time to overcome the stumbling blocks but not in the way it was handled before. Bottlenecks in resource management, financial inclusion and land acquisition must be removed on priority basis.”

Highlighting the range of subsidies provided by the Indian government, he said, “Many subsidies provided by the government are absolutely essential to run the economy. But the question arises whether these subsidies reaching the targeted audiences?”

Making special mention to the AADHAR project, he said, “As many as 500 million people are enrolled under the AADHAR. But unfortunately, its main objective to link subsidy with those who need them is still not accomplished.”

EFIL, which was launched on March 15 at the London School of Economic (LSE), aimed at providing a multidisciplinary perspective to the key drivers of Indian economy with finance, Bollywood, defence, industry and upcoming general elections as the major areas of discussion.

Among the other speakers who participated in the panel discussion were Executive President of Dainik Jagran, Sandeep Gupta, Bollywood actor Abhishek Bachchan, Development Credit Bank (DCB) Chairman Nasser Munjee, former Indian Air Force chief Air Chief Marshal (retired) Anil Tipnis, Narayana Health chairman and founder Dr Devi Shetty, Cobra Beer founder and chairman Lord Karan Bilimoria CBE.

The idea for EFIL was conceived by committee members of the India-focused society at LSE known as the Society for the Promotion of Indian Culture and Ethos (SPICE). The event included panel discussions on finance, entrepreneurship and the sluggish Indian economy especially in the light of general elections 2014.


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