Vibrant Gujarat Summit: GDP growth slowdown has bottomed, says Arvind Subramanian, CEA

GANDHINAGAR: Deceleration in growth has bottomed out and the economy is poised for 6-6.5 per cent expansion in the next financial year, Finance Ministry's Chief Economic Adviser Arvind Subramanian said today.

The challenge before the country, he said, is to continue with the economic reform process to attract public and private investment.

"(Decline in) growth has bottomed out. So we expect to see a gentle pick up. This year we should be at about 5.5 per cent and next year, with all the efforts that are being taken, it will inch-up to about 6-6.5 per cent," he told reporters on the sidelines of the ongoing Vibrant Gujarat Summit here.

Subramanian further said that some of the reforms take a little bit of time frame before the benefits tick in.

After sub-5 per cent GDP growth in the past two fiscals, the economy expanded by 5.5 per cent in the first half of 2014-15.

When asked if the RBI should go for interest rate cut as the inflation has come down significantly, the official replied in affirmative.

"Yes. (but the) timing is up to the Governor of Reserve Bank of India," he said.

On the fiscal deficit, Subramanian said the central government is committed to meeting the target of 4.1 per cent of GDP.

"We will do whatever possible to meet it (the target)," he added.