GDP for current fiscal will not reach 6.5%, says Chidambaram

Reserve Bank of India has nearly $500 billion as foreign exchange reserve

The Union Government half-heartedly accepted the World Bank’s growth forecast for India for the current fiscal, in which the financial institution downgraded the growth rate of Gross Domestic Product (GDP) from 7.5% to 6.5%, said former Union Finance Minister P. Chidambaram here in Tiruppur on Sunday.

Mr. Chidambaram, who visited the Senaapathy Kangayam Cattle Research Foundation at Kuttapalayam, told reporters, “the GDP will not reach even 6.5% in the current financial year. The current account deficit increased heavily because of the import of gold. The next 12 months will be challenging and the Union Government has to consult experts to take a proper decision.”

The Reserve Bank of India has nearly $500 billion as foreign exchange reserve. So, the economy will not be pushed to the extent of currency swap, he added.

Referring to Union Finance Minister Nirmala Sitharaman shopping for vegetables in Chennai on Saturday, Mr. Chidambaran quipped, “Going to the Mylapore market and enquiring about the prices of vegetables will not reduce the inflation rate.”

The Congress leader said the State Government could encourage farmers in the region to raise Kangayam cattle to conserve the breed. This would help conserve the entire ecosystem.