Domestic demand, investment can restore high growth: Nath

NEW DELHI: Creating domestic demand through investment in sectors like construction and mass housing can get the economy back on a high growth path, Commerce and Industry Minister Kamal Nath said on Monday.

Nath, who is returning to the Lok Sabha from Chindwara constituency, said the rural demand can help the manufacturing sector. "The demand in rural areas can be phenomenal and that will then drive the manufacturing sector," Nath told a news channel.

The country's industrial production shrank by over 2.3 per cent in March. The Commerce and Minister who has represented Chindwara, Madhya Pradesh, in Parliament for about three decades, said focus on mass housing would drive the construction sector.

"It is by stimulus packages of creating domestic demand-driven growth,creating domestic investment-driven model that we can hope to again go back to a good growth trajectory close to eight per cent," he said.

After an average nine per cent growth in the first four years, economic growth shrunk to around seven per cent in the previous fiscal. Different estimates peg the GDP growth rate at 5-6 per cent in the current fiscal. Nath, 62, is expected to get a key economic ministry in the new UPA government.