‘India on course for 11% growth this fiscal, to meet deficit goal’

CEA says capex will boost construction, but warns of ‘irrational exuberance’

Playing down concerns about high inflation and rising commodity prices, Chief Economic Adviser (CEA) Krishnamurthy Subramanian said on Monday that India was on course to grow at about 11% and meet the fiscal deficit target of 6.8% of gross domestic product this year. Asserting that the Union Budget’s plan to scale up capital spending by 35% in FY22 would boost construction activity and create jobs in the informal sector, Mr. Subramanian said this would boost demand and enable the country to get growth without high inflation. “I don’t foresee a problem at all in meeting those estimates for infrastructure spending,” the CEA said in an interaction with the Indian Construction Equipment Manufacturers Association, before warning them against a potential risk of ‘irrational exuberance’ over the coming few years.