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Sinha forecasts 6% GDP growth in 00-01

Finance Minister Yashwant Sinha has said the government is maintaining a growth forecast of over six per cent for the current fiscal year, helped partly by strong showing by the agricultural sector.

''This year, we estimate over six per cent growth in GDP,'' Sinha told a gathering of academics, journalists and businessmen in New York on Friday.

Gross Domestic Product growth will be better because ''the winter crop will put in a better performance'', he said.

His visit to the US was overshadowed by a dramatic sell-off in US stock markets, keeping portfolio managers and bankers tied to their desks.

The NASDAQ Composite Index closed at 3320, down 357 points, in the worst-ever point decline.

Sinha said India had faced off a major challenge in the near-tripling of oil prices and managed to build foreign exchange reserves to $ 38 billion and bring down the current account deficit to one per cent of GDP.

''According to various indices of performance, the Indian economy has done superbly in the last 12 months,'' Sinha said, pointing to a GDP growth of 6.8 per cent in the last fiscal year.

Asked if the government would take advantage of the buffer of foreign exchange reserves to liberalise the capital account and allow more free flow of foreign exchange, Sinha said the government would take gradual steps in that direction.

The government's major focus over the next few months and years will be in improving infrastructure such as telecommunications, roads, air traffic, airports and highways.

Foreign investors and corporations cite India's poor infrastructure as one of the major impediments to investment.

In response, ''We have cleaned up our policies and tried to introduce substantial liberalisation in all these (infrastructure) sectors,'' Sinha said.

The government is planning to privatise major airports, seaport facilities and parts of power generation, transmission and distribution, he said.

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