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Rangarajan urges new policy on infrastructure

Former RBI governor Dr Chakravarty Rangarajan has urged the government to announce a policy on infrastructure projects to define ownership, regulation and financing aspects. He also predicted a six per cent growth in the economy during 1998-1999.

Dr Rangarajan -- now the Andhra Pradesh governor -- stressed that the current account deficit ought to be moderate, ideally less than two per cent which would be manageable. He projected a six per cent growth in the economy during fiscal 1998-99 that may go up to even seven per cent in the medium-term.

A good monsoon will push up agricultural output which should stimulate growth in the industrial sector, he said. He projected a nine per cent growth in services and a six per cent growth in industry.

Dr Rangarajan said the Indian economy is different from East African economies that generally have current account deficits that exceed their GDP of five per cent.